Stoner Cats NFTs Face SEC; Critics Question Settlement’s Legitimacy

• SEC classifies Stoner Cats NFTs as unregistered securities.
• Stoner Cats 2 (SC2) agrees to a cease-and-desist order and a $1 million civil penalty.
• Critics, including Ripple’s Stuart Alderoty, question SEC’s settlement enforceability.

In its regulatory move against NFT offerings, the U.S. Securities and Exchange Commission (SEC) has classified Stoner Cats NFTs as unregistered securities. The company behind the NFTs, Stoner Cats 2 LLC (SC2), has “agreed to a cease-and-desist order and to pay a civil penalty of $1 million,” although it has not admitted or denied the SEC’s findings.

SC2 further committed to establishing a fund to refund NFT buyers, destroying all NFTs in its possession, and publishing notice of the SEC’s order on its website and social media channels. However, the SEC’s decision has not gone unnoticed by some critics who raised doubts about the settlement.

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