The SEC has once again kept its foot in the door regarding the crypto sector. The publishers of the NFT collection Stoner Cats, including actress Mila Kunis, have been sued for unauthorized securities trading. According to the SEC, the NFTs were allegedly sold with promises of profit and brought in US$20 million in royalties alone. Following the outcry in the altcoin sector, NFT projects now also seem to be caught in the authority's crossfire. Criticism of this is also coming from its own ranks.

SEC sues NFT project

The crypto sector has been under fire for some time thanks to the SEC. Consider, for example, the proceedings against Ripple. A common accusation: unregistered securities trading. The SEC is now talking about the NFT project Stoner Cats, co-founded by Mila Kunis. The sale of the token collection consisting of 10,000 different cats, for which a separate animated series is also being produced, allegedly violated securities laws.

Today we charged Stoner Cats 2 LLC with conducting an unregistered offering of crypto asset securities in the form of purported non-fungible tokens (NFTs) that raised approximately $8 million from investors to finance an animated web series called Stoner Cats.
— U.S. Securities and Exchange Commission (@SECGov) September 13, 2023

Criticism from within

Notable is the criticism from certain SEC members. A joint statement by SEC Commissioners Hester Peirce and Mark Uyeda criticizes the agency's action as excessive. They see the fact that NFTs are now treated as securities as absurd. If securities laws were similarly applied "On physical collectibles", "would artists' creativity get lost in the shadow of legal ambiguity".

Although the NFT market "no carte blanche" has, Peirce and Uyeda point out that projects such as the Stoner Cats have previously come under "fan crowdfunding" fall. In principle, NFTs "not much different from Star Wars collectible figures". Instead of "arbitrary enforcement measures" would there now "clear guidelines for artists and other creators" should be.