Slotie is selling NFTs that give their owners ownership of a portion of the casino and the ability to passively share in the profits from gambling. Slotie’s NFTs of 10,000 units are distinguished from each other by their rarity. Accordingly, the rarer the token, the greater the share of casino revenue to which its owner is supposedly entitled.

It is easy to understand what exactly the regulators were confused about in this scheme - such NFTs are similar in their properties to shares, i.e. securities that give their owner the right to receive part of the income of the issuing company in the form of dividends. Well, the authorities have a fairly straightforward attitude to such an asset class, even though they use outdated laws to do so.

What do NFTs and stocks have in common?

Slotie’s NFT distribution scheme doesn’t please regulators: the unique tokens have been equated with unregistered securities, making their distribution in violation of state laws. The company has thirty days to comply with the prescribed restriction. If NFT sales continue, the startup’s operators could face up to ten years in prison and fines. This could happen provided their guilt is proven.

Emergency cease and desist order against Slotie

According to Decrypt’s sources, Slotie’s management has not reacted to the news publicly in any way, that is, company representatives have not made any statement yet. Moreover, the following message appeared on the official Slotie Twitter account.

More features. What makes Slotie special is the commitment of the team and community. We are all moving towards a huge success. We’re going va-bank.

The hacker who steals other people’s NFTs

The allegations against the platform are just part of a recent trend of increased regulatory interest in the field of unique tokens. Until now, officials have not made many allegations about NFTs, but that is now changing. According to attorney Jeremy Goldman, more projects like Slotie will soon face sanctions. Here’s his rejoinder.

It’s an easy catch. Slotie’s NFTs are promoted as investments that give their owners passive income in the form of profits generated by the startup and its partners, much like the definition of stocks.

In other words, the expert makes it clear that such a lawsuit against the company would clearly end in a victory for the authorities. Accordingly, the budget in this case may be filled with fines, the amounts of which can sometimes be quite impressive.

The campaign against Slotie also stems from the fact that it is an online casino. The gambling industry in the United States is one of the most regulated, Goldman said. He continues to speak out about what is happening.

I believe part of the litigation is at the state level because there is a concern about gambling. In terms of litigation strategy and enforcement, regulators have decided that a focus on similarities to equities will be an advantage in court.

NFT by Slotie

Even the best-known NFT collections could be in trouble. For example, rumours had previously begun to circulate that the US Securities and Exchange Commission (SEC) was investigating studio Yuga Labs, which released a series of unique Bored Ape Yacht Club (BAYC) tokens. Here too, the allegations relate to the similarity of the NFT token distribution model to the sale of unregistered securities.

To recap, NFTs from the Bored Ape Yacht Club collection were available to the willing at 0.08 ETH, which at the time of the so-called mint was an entirely small amount. Today, however, the BAYC is the most popular NFT range. The minimum value of its representatives now equals 72.56 ETH, which is the equivalent of $98,000.

The minimum value of representatives of popular NFT-collections


It seems that the use of NFT tokens as company shares will not be in demand, because it is really very similar to stocks. And if regulators do not have much success equating ordinary cryptocurrencies with stocks, as seen in the protracted Ripple lawsuit against XRP, then there will clearly be no such problems here. Users of such projects should therefore be cautious, as their investments could turn to dust if regulators get active.


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