Why Is The FED Investigating Yuga Labs?

Estimated Read Time: 5 min

Hey friends,

A warm welcome back for our 40th newsletter! Today we have some great stories from the SEC investigating Yuga Labs, to news from one of Japan's largest gaming companies, so let's just jump into it!

SEC Investigating Yuga Labs NFT Collections

By sales volume, the top four NFT projects of all time (in order) consist of CryptoPunks, Bored Ape Yacht Club (BAYC), Mutant Ape Yacht Club (MAYC), and Otherdeed for Otherside. Apart from all being extremely successful, they are also all children of the parent company 'Yuga Labs'. These four projects total over 2.4 million ETH in volume (over $3 billion dollars USD), so it's not surprising to see Yuga catch the eye of the federal government. The US Securities and Exchange Commission (SEC) is in charge of enforcing the law against market manipulation after being created in the wake of the Wall Street Crash of 1929.

Earlier this week the SEC started investigating the Florida-based company over whether sales of its digital assets violate federal law. The key legal question here is whether NFTs are securities like stocks, with collections giving long-term utility and financial return, it causes a similar resemblance to stocks and investment contracts which falls under the eye of the SEC. A spokesperson at Yuga said "It’s well-known that policymakers and regulators have sought to learn more about the novel world of Web3. We hope to partner with the rest of the industry and regulators to define and shape the burgeoning ecosystem. As a leader in the space, Yuga is committed to fully cooperating with any inquiries along the way.” That statement neatly summarizes what this “Federal Investigation” means for the NFT world, although sometimes positioned as Yuga Labs being in trouble, this actually marks how the current leaders of the space are working alongside regulators to create a safer and more accessible NFT-powered Web3.

Budweiser Partners With FIFA World Cup For NFT Collection

Budweiser is hands down the highest-selling beer in America, and after buying the “beer.eth” wallet address for 30 ETH over a year ago, they officially have sights set on continuing their legacy in Web3 with the “Budverse”. Next to be introduced into the equation is the official FIFA World Cup association, home to the 2022 Qatar Soccer World Cup which is expected to have over 5 billion people tune in during the event. In celebration of FIFA's and Budweiser's over 30 years of World Cup sponsorship, together these world-renowned brands are launching the NFT collection “Budverse X FIFA World Cup”.

The project is centered around an NFT that tracks the progress and scores of a holder's chosen country, while also giving exclusive access to benefits, rewards, and other surprises within the Budverse. Each NFT will come with a unique Budweiser soccer merch kit and is available to mint for $100 USD up until December 18th from Budweiser.com/nft. An NFT campaign with this literal global reach will require crucial management and guidance for smooth sailing through this new Web3 world, so there's no better partnership than Vayner3 who helped develop the program concept and creatives. To fill in the gaps, Vayner3 is a Web3 consultancy under the media agency VaynerX which was founded by NFT pioneer Gary Vaynerchuk. Gary is well known for his Veefriends NFT project which currently holds the 20th spot in all-time NFT sales, we recently covered Veefriends for their latest partnership with Toys’R’us and Macys which you can check out here. The triple combination of Budweiser, the FIFA World Cup, and Vayner3 teaming up for an NFT collection is likely not something that could have been guessed a few years ago, but truly shows the growth and influence that NFTs are starting to have on these legacy brands

Major Japanese Gaming Company Launches Metaverse Initiative

Japan is home to some household name gaming companies with their top-selling publishers being Nintendo, Capcom, and the Pokemon Company, but 4th on that list is Konami who has recently announced plans for a wide range of Web3 products and services. Even if you are unfamiliar with Konami, the entertainment conglomerate is the real deal, bringing in nearly $2 billion USD in revenue per year they no doubt have a large influence on the gaming market. In a recent announcement, Konami stated “We have been conducting research and development to incorporate the latest technology into games and contents, and plan to launch a service where players can trade their in-game NFTs (digital items) through a unique distribution platform using blockchain”. Konami talked about how NFTs can be used for several purposes, not only in the future will they represent unique in-game items, but Konami recognizes the potential for fans to interact with services and communities in new ways.

Coinciding with the announcement, the gaming giant listed new job opportunities to recruit a “wide range of talent” for "system construction and service development,” relating to the future metaverse and Web3 initiatives including the “unique digital item distribution platform” that Konami mentioned in the initial announcement. After Japan recently announced incentives for Web3 services, it is no surprise that Konami is looking to engage with this new Web3 world. Due to Konami's presence, their step into Web3 could influence other game developers to consider the benefits of the blockchain. Konami now joins a list of NFT supporters such as Epic Games signaling that it might not be long until everyone embraces the benefit of digital ownership through NFTs. If you want to learn more about how NFTs are changing games, feel free to check out our coverage of Play-2-Earn games here.

Huge thank you to everyone taking the time to read our newsletter, this marks our 40th edition of Morning NFTea but we are only just getting started! We hope to continue giving you the latest and best in NFT developments far into the future, but until the next edition, have a great couple of days and we will be back in your inbox soon!

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DISCLAIMER:

None of this is financial advice. This newsletter is strictly educational and is not investment advice or a solicitation to buy or sell any assets or to make any financial decisions. Please be careful and do your own research.