Digital Assets Don’t Require Special Consideration, Says NASAA; NFT Project LSC Defrauded Of $1Mn

Here are some latest developments in the crypto space.
Digital Assets Don’t Require Special Consideration, Says NASAA; NFT Project LSC Defrauded Of $1Mn
Digital Assets Don’t Require Special Consideration, Says NASAA; NFT Project LSC Defrauded Of $1Mn

The North American Securities Administrators Association (NASAA) has said that digital assets do not require any “special consideration” in matters of application of US securities laws, rejecting Coinbase’s defence against the Securities and Exchange Commission (SEC).  

In a filing on October 10 in the US District Court for the Southern District of New York, NASAA supported the SEC’s position, stating that actions against Coinbase shouldn’t be viewed as “special”, “novel, or extraordinary.”

In June 2023, the SEC sued Coinbase, a publicly listed cryptocurrency exchange, on the grounds that it broke federal securities laws. Coinbase retaliated, saying that the SEC went “too far” and that its digital assets/ services did not meet the criteria for securities.

NASAA general counsel Vincente Martinez argued the SEC’s position is neither “novel nor extraordinary.” Martinez said, “The SEC’s theory, in this case, is consistent with the agency’s longstanding public position. It is also well within the bounds of established law.”

Artist Creates Crypto ‘Rug Pull’ In Front Of SEC Building

Artist Nelson Saiers’ “Rug Pull” artwork was aimed at highlighting the victims’ plight and the perceived SEC inaction in safeguarding their interests.

On September 14, a vendor opened up shop in front of the SEC building, converting a section of Maiden Lane into a patchwork of doormats spray-painted with the phrase “pull”.  

Saiers, a former hedge fund manager, is regarded as New York’s most inventive activist in the cryptocurrency space. The artwork has reportedly drawn the attention of many victims.

Astrology NFT Project Lucky Star Currency Rugged For Over $1M  

According to blockchain security firm CertiK, the Lucky Star Currency (LSC), an astrology-themed nonfungible token (NFT) project, executed an “exit fraud” for more than $1 million.

In a report on October 9, CertiK said that a “deployer” account for LSC drained over $1 million in tokens from the project and then swapped them to BUSD using PancakeSwap.

The report said that over $1 million worth of tokens were “taken out of the NFTMerge and AdwardCenter contracts” by the project’s deployer account via the “Withdraw Token” function. After that, these tokens were transferred to a different account and exchanged for the stablecoin Binance USD (BUSD). LSC claims to have been developed by astrologists.  

Its contracts include an NFT Marketplace and an Award Centre. Its target market is China. The project is marketed by X (formerly Twitter) with the username AstrAstrol75591. It has a Telegram channel as well. The project’s user interface and website are unavailable as of October 9.

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