According to Cointelegraph: SEC Commissioners Hester Peirce and Mark Uyeda have criticized their agency’s $750,000 settlement with FlyFish Club, a non-fungible token (NFT)-based restaurant, for allegedly conducting an unregistered offering of crypto asset securities. The SEC claimed FlyFish made $14.8 million by selling 1,600 NFTs, triggering securities laws. However, Peirce and Uyeda argued the NFTs were merely a creative membership model and shouldn’t fall under securities regulations.
In their dissenting letter, the commissioners stated, “Creative people should be able to experiment with NFTs without having to consult a high-priced tea-leaf reader—ahem, lawyer.” They emphasized the need for clearer guidance to allow NFT creators more freedom.
FlyFish Club, founded by entrepreneur Gary Vaynerchuk, offered NFTs granting access to a high-end dining experience in Manhattan. The restaurant is set to open soon, but the SEC’s action requires FlyFish to destroy unsold NFTs and forfeit any future royalties. This settlement follows recent SEC actions against other NFT projects, such as Impact Theory and Stoner Cats 2.