- Four U.S. securities regulators have accused NFT platform Slotie of fraudulently funding a metaverse casino using NFT sales
- The regulators have since directed the platform to halt operations through cease-and-desist orders
- The regulators are from Texas, Kentucky, Alabama and New Jersey
Securities regulators from New Jersey, Alabama, Kentucky and Texas have accused NFT platform Slotie of fraudulently funding a metaverse casino using proceeds of NFT sales. The NFT platform, based in the U.S. state of Georgia, is alleged to have sold NFTs that gave holders the right to own part of the casino which is against securities laws among other infractions.
NFTs Fund Metaverse Casinos
In a press release, regulators in the four states accused Slotie of issuing 10,000 NFTs “to raise capital for online and metaverse casinos”, also holding that the NFT platform ignored set laws governing the issuance of securities. According to the allegations, these types of NFTs are akin to equities such as stocks.
Apart from giving investors ownership of the metaverse casinos, the regulators argue that they also allow the investor to passively receive a share of the proceeds from the casinos plus a certain amount of Slotie’s native token, WATT. WATT is believed to play “a key role in the illegal scheme.”
Supercharge Your Profits
In a statement by the Texas State Securities Board, Slotie promised investors that “each Slotie NFT generates 10 WATTS per day.” After collecting 1,800 WATTs, the holders would get a chance to mint a special NFT “known as Slotie Junior,” consequently supercharging their profits by 200% and giving them a piece “of land in a metaverse.”
Texas and the other states have ordered Slotie to immediately halt operations since its business doesn’t comply with existing securities laws. The development is the latest in state regulators extending their reach into the virtual world, augmented by the IRS recently hinting at taxing NFTs and crypto using the same rules.