In a surprising turn of events, the SEC is wrapping up its inquiry into OpenSea. According to official reports, the Securities and Exchange Commission announced on Friday that it was withdrawing the lawsuit it had been pursuing against the NFT marketplace.
The decision saw a a positive response from Coinbase CEO Brian Armstrong who took to X to congratulate users on the matter.
Most market participants believe that the SEC’s attempt to categorize NFTs as securities would have slowed innovation in the sector and would ultimately result in the misinterpretation of the law.
SEC’s OpenSea Case Withdrawal Stands Second in The Row
SEC’s case withdrawal against OpenSea is the second indication that the agency is reversing course in its campaign against the digital asset market.
The regulator also halted a second securities-based action against Binance earlier this month, stating that the organization’s new crypto task force’s efforts “may impact and facilitate” a possible resolution.
The move is a significant development for the digital asset, blockchain, and NFT space, largely indicating that that the overall scrutiny over the sector is now easing.
Also Read: OpenSea Data Hack Exposes 7M User Emails, Security Risk Looms
OpenSea Probe: What Was The SEC Investigating?
The top NFT marketplace, OpenSea, was under investigation by the U.S. Securities and Exchange Commission (SEC) after possible insider trading and market manipulation raised red flags.
The investigation centered on whether OpenSea employees or associates were profiting from NFT transactions prior to their public debut by abusing their privileged knowledge of impending listings.
The SEC specifically examined well-known examples in which OpenSea workers reportedly bought NFTs before they were listed on the platform, using information that the public was not able to access.
The study brought into question whether NFTs should be subject to more stringent regulatory monitoring if they were categorized as securities under U.S. law.
The SEC, however, indicated that there was not enough evidence for enforcement when it opted to conclude the inquiry after several months of review.
OpenSea Market Domination Back To Its Peak
SEC’s decision to drop the investigation also comes at a time when OpenSea has experienced a surge in market value.
As UnoCrypto reported earlier, the platform now makes up 71.5% of total trade volume in the Ethereum NFT-market place, up significantly from just 25.5% four weeks ago.
The milestone represents OpenSea’s remarkable resurgence and the company’s strong return to market share in the Ethereum NFT industry.
This significant increase shows OpenSea’s ability to regain dominance after competition from other NFT exchanges. Improved user experience, strategic partnerships, and an increase in the NFT industry’s overall appeal have all contributed significantly to OpenSea’s growth in market share.
OpenSea’s extensive library of digital resources and engaged community support help to solidify its leadership.
Also Read: OpenSea Users Withdraw Lawsuit After Judge Allows Firm to Demand Arbitration