Going hard in the (digital) paint… but it's no game. A judge this week denied a request from Dapper Labs, the maker of NBA-themed NFTs dubbed “Top Shot Moments,” to toss out a lawsuit against it. The suit, brought by Top Shot Moments buyers, alleges that Dapper’s blockchain-based collectibles are securities and therefore should’ve been registered with the SEC. It’s one of the first judicial decisions addressing whether NFTs are securities.
Top whats: After Moments launched in 2020, the NFT highlight clips found fast success among non-crypto-native collectors.
Top whys: Collectors could buy Moments with a credit card, no blockchain knowledge required (just a love of b-ball).
Top buys: Moments have seen $982M in trading volume, with some sought-after NFTs selling for more than $200K.
On the rebound… While crypto winter chilled the already cooling NFT market, it didn't put it on ice. Last month saw $780M in NFT transactions on the ethereum blockchain, up from $547M in December (but way down from $5B in January 2022). And Blur, an NFT marketplace that launched in October, has surged in popularity — capturing 40% of NFT retail trades this month. Meanwhile, bitcoin hopped on the NFT train with ordinals. But bubbling NFT hype could be dampened by regulatory scrutiny.
“Fun and games” could get serious… While Dapper Labs bills its NFTs as sports collectables, it's not clear if the courts will agree. And although it's no slam dunk, a ruling saying that Top Shot Moments are securities could pressure some crypto businesses to register their NFTs with the SEC and shake up the entire nonfungible industry.