The legal fight lingers for Dapper Labs after SEC scrutiny
Recent reports have unveiled that the U.S. Securities and Exchange Commission (SEC) has concluded its investigation into Dapper Labs, the innovative force behind acclaimed NFT ventures such as NBA Top Shot and CryptoKitties, as well as the versatile FLOW blockchain. However, amidst this closure, a legal saga ensues.
According to Fortune, the SEC’s cryptocurrency and cybersecurity division, spearheaded by David Hirsch, wrapped up its scrutiny of Dapper Labs on September 29. The motives prompting both the commencement and resolution of this investigation remained shrouded in confidentiality.
Nonetheless, despite the investigative curtain falling, Dapper Labs remains ensnared in a persistent legal entanglement. The pioneering web3 entity finds itself entangled in an ongoing class-action lawsuit alleging that NBA Top Shot Moments constitute unauthorized securities.
With the legal battle unfolding and all depositions anticipated to conclude by June 17, the ultimate legal fate of Dapper Labs hangs in uncertainty.
Dapper Labs’ Trajectory: Growth and Obstacles Since its inception and the launch of CryptoKitties in late 2017, Dapper Labs swiftly ascended within the digital collectibles realm. The company gained significant momentum with the introduction of NBA Top Shot, backed by endorsements from notable basketball figures and fostering robust trading activities.
However, the NFT sector witnessed a substantial downturn in 2022, marked by plummeting sales volumes, compelling Dapper Labs to undertake staff reductions in 2023.
These transitions unfolded against the backdrop of a heightened regulatory landscape, particularly following the FTX exchange’s demise, with the SEC intensifying scrutiny over crypto-centric enterprises.
