- The Stoner Cats NFT project has been banned from top exchanges following charges from the SEC regarding unregistered securities
- The project’s creators agreed to pay a $1 million fine last week, leaving exchanges in a difficult position
- While Stoner Cats NFTs are no longer available on major exchanges they still exist on the blockchain and can be traded on other platforms
The Stoner Cats NFT project has been banned from top exchanges following charges from the Securities and Exchange Commission (SEC) over unregistered securities. OpenSea, Blur, and Rarible are among the NFT exchanges that have barred Stoner Cats after the project settled with the SEC over the charges which put the exchanges in a difficult position and all but ends the project’s hopes of gaining any further market traction.
SEC Charges Kneecapped Collection’s Prospects
The collection of Ethereum-based NFTs, linked to a celebrity-filled animated series, were initially sold in 2021 and have been tradable across various marketplaces ever since. However, last week the project’s creator agreed to pay a $1 million penalty to the SEC for offering unregistered securities, kneecapping the prospects of the collection and leaving exchanges with little choice if they want to avoid being accused by the SEC of selling unregistered securities.
As a result, OpenSea and Blur no longer show any active listings for Stoner Cats NFTs while Rarible has removed the project from its site. OpenSea still maintains the project page for blockchain exploration purposes even though trading has been disabled, while Rarible and Blur seem to have blocked Stoner Cats NFTs entirely.
Holders Can Still Trade
While Stoner Cats NFTs are no longer listed and therefore cannot be transacted, the kittens haven’t been thrown into a hessian sack with a few bricks and dumped off a bridge just yet; they still exist on the blockchain and within holders’ wallets and can still be sold on other platforms, such as LooksRare and X2Y2.
The SEC reported that Stoner Cats sold 10,420 NFT passes in July 2021, generating over $8 million from the primary sale and earning additional revenue from secondary market sales, totaling more than $20 million.
As well as the $1 million civil penalty, the project’s creators agreed to establish a Fair Fund to reimburse investors and committed to destroying any remaining NFTs in their possession.