The creators of Stoner Cats NFTs were charged on Wednesday by the United States Securities and Exchange Commission (SEC) with selling unlicensed securities. However, the charges have not stopped NFT collectors from buying those digital art pieces on secondary markets.
Data from Opensea, a popular NFT marketplace, shows that multiple Stone Cats have changed hands since the SEC announced its enforcement action. By comparison, only one NFT from the collection was traded on Tuesday.
With the increased trading activity, the prices of Stoner Cats NFTs have surged massively. Before the Commission’s charges, the cheapest NFT was valued at $25, but the figure has shot to $78 as of this writing.
Why NFT Collectors are Buying Stoner Cats
So why purchase NFTs from a project that is in a regulatory battle? Many crypto analysts believe that most people are buying these NFTs, hoping for a refund. That’s because the SEC said it would penalize the Stoner Cats NFT creators and use the penalty fee to set up a Fair Fund to refund investors.
However, it remains unclear how much each holder will receive. The SEC has already announced that the creators are willing to settle their charges by paying a $1 million fee without denying or accepting the charges.
Stoners Cat NFTs were launched in June 2021. At the time, each sold for 0.35 ETH or roughly $789. Within half an hour after the launch, over 10,400 NFTs were sold, with the creator raising approximately $8.1 million.
Stoner Cats Creators Set to Destroy Their NFTs
Meanwhile, besides agreeing to pay the $1 million penalty, Stoner Cats creators have also agreed to destroy the 5,000 NFTs they hold from the collection. Destroying these non-fungible tokens means sending them to a burn address, which makes them permanently inaccessible.
The big question that remains unanswered is whether Stoner Cat NFT holders will lose access to the perks that come with holding these tokens. One of the benefits is access to a web series titled “Stone Cats.” However, since the video series lives on the decentralized blockchain Arweave, creators are unable to control it, so there is a possibility NFT holders may continue enjoying the show.
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