Not everyone goes ape for the Bored Ape Yacht Club
Questions of market manipulation raised over BAYC
Posted May 31, 2022 by Daren Firestone
This month, there were reports of potential insider trading related to Bored Ape owner Yuga Labs’ acquisition of Meebits, the popular creator of 3D NFT avatars. “According to data from blockchain security firm PeckShield, 14 Ethereum addresses with no clear history of NFT purchases had bought 159 Meebits between March 5 and March 11. This occurred just before Yuga Labs said it would purchase the rights to Meebits and CryptoPunks from Larva Labs.” Then, there were questions about the reported self-serving release of ApeCoin, a token that, according to its website, “will serve as a decentralized protocol layer for community-led initiatives that drive culture forward into the metaverse.” Uh…OK sure.
There are still questions about whether NFTs are securities, but the SEC has reportedly issued subpoenas in connection with a probe of “NFT creators and marketplaces…looking into whether NFTs ‘are being utilized to raise money like traditional securities.’" Expect more regulatory engagement in the NFT space soon. If it looks like market manipulation or insider trading, the SEC will probably say it is.