Securities regulators from four states in the United States have clamped down on metaverse casino ‘Slotie NFT’ for violating securities laws. The state securities regulators slammed the entity with a cease-and-desist order to shut down its operations. Reportedly, the regulators noted that the company was offering unregistered securities through NFTs.
Here’s all you need to know about what went down with Slotie NFT:
What happened with Slotie NFT?
On October 20, state securities regulators from Texas, New Jersey, Kentucky, and Alabama filed emergency cease-and-desist orders against Sloties NFT. Based in Georgia, Slotie is a virtual gambling company that describes itself as an “online casino network on the blockchain.”
The entity runs gambling games in more than 150 casinos. Furthermore, it sold an initial collection of 10,000 NFTs that provided holders ownership interest in the casinos. This way, the investors could earn a passive income from Slotie’s profits.
However, according to the state regulators, these were unregistered securities that violated state laws. As a result, the authorities have filed a cease and desist against Slotie, preventing it from selling the NFTs in the four states.
“The actions accuse Slotie of issuing 10,000 Slotie NFTs that are similar to stock and other equities,” said a statement from the Texas State Securities Board. “The Slotie NFTs purportedly provide investors with ownership interests in the casinos and the right to passively share in the profits of the casinos.”
US regulators and NFTs
The state regulators’ move comes amid multiple such enforcement actions against other Web3 and NFT projects. For instance, five American state regulators accused Flamingo Casino Club of being a scam run by Russian scammers. Meanwhile, the United States Securities and Exchange Commission (SEC) has been investigating Yuga Labs for possible securities violations.