The State Securities agency of Texas and Alabama ordered a cease & desist to the operations of the Virtual Casino development plan in Metaverse by collecting funds under Unregistered NFTs securities offerings.
In the present time, almost every successful company is looking to step into Metaverse, to step with the ongoing trend of Metaverse & Web3 based virtual world. In this race almost every type of company, from Banking services to tech services and also entertainment services to health services. So entry of the gambling industry should not be a strange thing, however, regulatory approval will play an important role for the Casinos and gambling platforms
Just a couple of days ago, the Texas State Securities Board issued its order against Sand Vegas Casino Club, Martin Schwarzberger, and Finn Ruben Warnke.
According to the issued report, these casinos are offering NFTs offerings to collect funding for the development of virtual casinos in Metaverse, against the rules.
As per the allegation, Sand Vegas offered around 11,111 NFTs to raise funds for its virtual casino. With the offerings, Casino claimed to give a profit return to the Gambler NFTs and Golden Gambler NFTs buyers from their future casino project, which actually falls under the Securities law.
Reportedly, Gambler NFTs owners could get profits between $1,224 and $24,480. While Golden Gambler NFTs holders would be able to earn from $6,480 minimum to $81,000 maximum per year.
On 9 April, the listing price of Gambler NFTs was in the range of 0.23 ETH to 777.77 ETH. So basically it was offered to sell at $744 to $2.5 million. On the other hand, the listing price of Golden Gambler NFTs was in the range of 2.13 ETH ($6,793) and 169 ETH ($547,000).
Securities body order noted that respondents are trying to avoid the securities law with the NFTs-based fundraising concepts, which still fall under the Securities law.
“The Respondents are also devising a scheme to obstruct any attempt to regulate the Gambler NFTs and Golden Gambler NFTs (…) They are misleading purchasers by claiming they can simply avoid securities regulation by implementing illusory features or using different terminology.”
As Sand Vegas has no regulatory approval from the SEC agency to offer any kind of securities offerings, it can’t process such things in Alabama and Texas.