The United States Securities and Exchange Commission (SEC) is launching a probe into Bored Ape Yacht Club creator Yuga Labs. The probe centers around whether sales of its digital assets violate federal law, Bloomberg reported Tuesday, citing people familiar with the matter.
SEC Investigates Yuga Labs Over Unregistered Offerings
Per the report, the SEC is investigating whether certain non-fungible tokens (NFTs) from Yuga Labs are related to stocks and hence should follow the same disclosure rules. The securities watchdog is also investigating the distribution of ApeCoin, which the project airdropped to holders of Bored Ape Yacht Club and related NFTs.
Launched in March 2022, ApeCoin is a governance token used within the APE ecosystem. After launch, the token was distributed to BAYC, Mutant Ape Yacht Club (MAYC), and Bored Ape Kennel Club holders. 62% of the total supply of ApeCoin was allocated to the ApeCoin community while 15% of the total supply was airdropped to BAYC and MAYC NFT holders.
“It’s well-known that policymakers and regulators have sought to learn more about the novel world of Web3. We hope to partner with the rest of the industry and regulators to define and shape the burgeoning ecosystem. As a leader in the space, Yuga is committed to fully cooperating with any inquiries along the way,” Yuga Labs said.
Based in Miami and founded in 2021, Yuga Labs is a blockchain technology company that develops NFTs and digital collectibles and also specializes in the field of cryptocurrencies.
It is worth mentioning that Yuga has not been accused of any wrongdoing and the probe by the SEC does not mean the company will be sued, the report stated.
ApeCoin Plunges Over 8% Following Announcement
ApeCoin dropped slightly more than 8% following the announcement of the SEC probe and was trading at $4.38 at the time of writing.
Meanwhile, several crypto companies in the United States have continued to be the subject of regulatory scrutiny from the SEC for alleged securities listings over the years. Just recently, the regulator sued Cayman Islands-based software development firm Sparkster Limited over an unregistered $30 million token sale.
