- OpenSea urges the SEC to clarify that NFT marketplaces are not securities exchanges or brokers.
- OpenSea asks the SEC for clear rules to avoid overregulation of NFT platforms.
- NFT trading volumes dropped by 19% in 2024 despite OpenSea’s regulatory push.
OpenSea has formally asked the U.S. Securities and Exchange Commission (SEC) to exclude NFT marketplaces from federal exchange regulations. OpenSea’s general counsel and deputy general counsel presented the request through a letter directly to SEC Commissioner Hester Peirce. The document explains how NFT platforms differ from classic securities exchanges and broker organizations.
According to the letter, NFT marketplaces do not facilitate peer-to-peer trading of identical assets. They also do not mediate transactions between multiple buyers and sellers in a traditional format. The company emphasized that NFT trading involves non-fungible assets, which are unique and do not meet standard definitions of securities.
Legal Grounds and Request for Guidance
OpenSea expressed concern over regulatory uncertainty caused by past SEC enforcement actions targeting crypto platforms. The legal team believes this uncertainty could affect American innovation and technology development.
In addition, OpenSea asked the SEC’s Crypto Task Force to issue informal guidance on the legal classification of NFT marketplaces. The company suggested using a similar approach to recent staff statements regarding memecoins and stablecoins.
The letter asked that future guidance address how exchange rules apply to platforms for non-fungible assets. It also recommended exempting NFT platforms from any future exchange or broker regulations.
Opposition to Broker Classification
OpenSea also addressed the possibility of NFT marketplaces being labeled as brokers under federal law. The platform denied it qualifies as a broker since it does not provide investment advice or control user funds.
It further explained that NFT platforms do not execute trades or negotiate deals on behalf of users. Based on this, OpenSea requested that the SEC confirm NFT platforms are outside the broker category.
OpenSea argued that broker classification would be inappropriate for platforms focused on digital collectibles. It noted that NFT platforms operate more like digital storefronts than financial intermediaries.
Industry Context and Recent SEC Action
This appeal follows the SEC’s recent decision to close its investigation into OpenSea. The agency concluded the probe without pursuing legal action or classifying NFTs as securities.
Industry experts noted this marked a shift in the SEC’s approach toward NFT regulation. The Commission has recently clarified that some stablecoins and memecoins do not qualify as securities. NFT trading volumes have dropped significantly since 2020. In 2024, trading activity decreased by 19%, and total sales fell by 18% from the previous year.
Despite the decline, OpenSea continues to push for clear rules that separate NFTs from other crypto assets. The company has positioned itself as a marketplace for discovering digital collectibles, not a trading platform for securities.
