- SEC charges Stoner Cats $1 million for offering to invest in unregistered NFTs.
- The SEC claims that the marketing services of Stoner Cats, which highlighted the projects’ expertise in crypto and animation development, generated false expectations of profits for investors.
The US Securities and Exchnage Commission (SEC) has charged the NFT collection Stoner Cats for offering unregistered NFTs to investors, which the legislator believes are crypto-asset securities. Stoner Cats raised $8 million in profit through its animated web series and NFT sales. The Stoner Cats 2 collection comprised 10,000 unique pieces priced at $800 per unit and sold out in less than an hour.
The SEC holds that Stoner Cats’ marketing services highlighted the project’s expertise in the crypto space and contacts in Hollywood, leading investors to false expectations of profits.
“Here, the SEC’s order finds that Stoner Cats marketed its knowledge of crypto projects, touted that the price of their NFTs could increase, and took other steps that led investors to believe they would profit from selling the NFTs in the secondary market.” – Gurbir Grewal, Director of SEC Enforcement Division.
As part of the settlement, Stoner Cats has agreed to a cease and desist order and to pay a fine of $1 million. Stoner Cats will also be required to establish a Fair Fund to return the monies to investors and destroy all NFTs in the project’s possession.