SEC closes Yuga Labs investigation with no charges

The U.S. Securities and Exchange Commission (SEC) has officially closed its investigation into Yuga Labs, the company behind the Bored Ape Yacht Club (BAYC) NFT collection, without filing any charges.

This decision marks a significant victory for the NFT industry, as it clarifies that certain digital assets are not considered securities under U.S. law.

The investigation, launched in October 2022, aimed to determine whether Yuga Labs' NFT offerings and the distribution of ApeCoin (CRYPTO:APE), a cryptocurrency associated with the BAYC ecosystem, violated federal securities laws.

The SEC applied the Howey Test, a legal framework used to assess if transactions qualify as investment contracts and thus securities.

"After 3+ years, the SEC has officially closed its investigation into Yuga Labs. This is a huge win for NFTs and all creators pushing our ecosystem forward. NFTs are not securities," stated Yuga Labs, welcoming the outcome.

This decision aligns with a broader shift in the SEC's approach to cryptocurrency regulation, as the agency has recently dropped or suspended investigations into several major crypto firms.  

The NFT market, despite facing challenges in 2024 with trading volumes dropping to $1.5 billion by the third quarter, is projected to grow significantly.

According to Technavio, the global NFT market is expected to increase by $84.13 billion between 2025 and 2029, driven by growing demand for digital art and interest from major brands.

Yuga Labs' Bored Ape Yacht Club NFTs have been among the most valuable in the space, with the floor price on OpenSea briefly reaching 13.9 ETH recently.