Messenger App LINE Launches LINE NFT Amidst Regulatory Uncertainty

Regulatory Uncertainty Could Test LINE’s Global Expansion Goals

In Japan, there is currently no law that regulates NFTs. Crypto assets, including Bitcoin (BTC), are considered electronically recorded property values, transferrable through electronic processing platforms, and usable as a means of payment.

By contrast, NFTs do not serve a similar economic function and cannot be considered crypto assets.

Until there are clear guidelines on the classification of NFTs, there remains a risk of unpredictable regulatory action.

The launch of LINE NFT may raise the eyebrows of a few lawmakers, especially when considering the demographics of LINE users in Japan.

NFTs also fall into a grey area in the U.S, vis-à-vis regulatory oversight. As a result of the regulatory uncertainty, platforms may fall foul of regulators.

This week, virtual casino Sands Vegas Casino Club received a cease-desist order for selling NFTs to fund operations. According to the state laws of Alabama and Texas, the NFTs constituted an illegal securities offering.

Sands Vegas Casino sells NFTs on the OpenSea marketplace. NFT sales revenue funds the development of metaverse casinos. Casinos are targeting popular metaverses, including the Sandbox (SAND), Decentraland (MANA), Infinity Void, and NFT Worlds.

News of the cease-and-desist orders comes as Coinbase prepares to launch CoinbaseNFT.

Regulatory scrutiny will likely intensify when considering the current rise in the number of NFT marketplaces.

For leading NFT marketplaces such as OpenSea, a more competitive playing field could eat further into trading volumes.

OpenSea Trading Volumes See Downward Trend Since January Peak

Since a January peak, leading NFT marketplaces have seen trading volumes plummet. This month, FX Empire reported OpenSea trading volumes falling for a second consecutive month in March.

Increased competition will further impact trading volumes, as will any shift in the regulatory landscape.

The emergence of new marketplaces will force OpenSea and other established NFT marketplaces to expand offerings, which may also draw greater regulatory scrutiny.

This year, the surge in NFT trading activity and the rise in illicit activity drew the attention of UK lawmakers. British members of Parliament reportedly called on the government to impose tougher regulations on cryptos and NFTs.

The U.S government has also taken a similar stance, with Joe Biden signing an Executive Order to tackle the digital asset space.


Source link

Leave a Reply

Your email address will not be published.