Apecoin Swan Dive Follows Report Of Hairy Eyeball From SEC

Apecoin fell 14% on Wednesday, tumbling to $4.71, following a report that the U.S. Securities and Exchange Commission is investigating sponsor Yuga Labs over whether its popular collections of non-fungible tokens (NFTs)–including the Bored Ape Yacht Club series–should be considered and regulated as securities.

The Bloomberg report should have surprised no one–the SEC has been known to be interested in NFTs for some time as part of its competition with the Commodity Futures Trading Commission for clout in regulating crypto, and Yuga is the NFT market leader with its collections valued at about $2.4 billion.

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Apecoin itself may also be under SEC scrutiny, according to Bloomberg, but a spokesman for the agency declined to comment on the matter. The Ethereum-based governance and utility token was designed to be used within the APE ecosystem, including the top three NFT collections by market value—Bored Ape Yacht Club, CryptoPunks and Mutant Ape Yacht Club—and metaverse collection Otherside. Now, it can also be used for in-store purchases in the United States at luxury-brands outlets like Gucci and Tag Heuer Monaco.

Ambiguity about the legal classification of NFTs has put the brakes on projects by major companies, especially banks, which have largely limited initiatives to issuing free NFTs. Some have prohibited their trade in open marketplaces to avoid the question of whether or not they could be deemed to be securities.

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Apecoin’s sharp drop notwithstanding, the company made a $300,000 donation to the Venture Miami Scholarship Fund to give free-tuition STEM education to underserved communities in the city, where Yuga is based. The donation is part of a larger $1 million pledge to arts education in Miami.

“As we continue to build our business here, we’re glad we can also help to build a strong, passionate community where there are no barriers to access, and creativity knows no limits,” Wylie Aronow, cofounder of Yuga Labs, said in a press release.

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