As word got into the market that the Securities and Exchange Commission (SEC) is probing Yuga Labs, the creators of the Bored Ape Yacht Club (BAYC) NFT collection to see whether it’s violating federal law, ApeCoin fell nearly 10%. APE’s price is down 7.38% in the last 24 hours.
The SEC is trying to establish whether or not the sale of Yuga Lab’s offerings is violating federal law. But the agency’s investigation is nothing new. It has been looking into NFTs since earlier this year. SEC wants to see whether some digital collectibles which are backed by blockchain are following federal securities rules.
According to Bloomberg, Yuga Labs is being investigated by SEC for its NFTs and ApeCoin, which is issued by ApeCoin DAO that was adopted by Yuga. But it should be noted that the federal watchdog has not accused Yuga Labs of wrongdoing. A spokesperson for Yuga Labs said its well known that policymakers and regulators have sought to learn more about the novel world of Web3. The company hopes to partner with the rest of the industry and regulators to define and shape the burgeoning ecosystem.
Yuga Labs, which was founded in 2021, has emerged as one of the most important players in NFTs. The BAYC collection is very much popular with celebrities like Snoop Dogg and Jimmy Fallon. ApeCoin came out in March 2022. It was issued to owners of Bored Apes and other Yuga Labs non-fungible tokens. APE gives Yuga Labs NFT holders influence over the operations of ApeCoin DAO.