2020 and NFTs
As mainstream players go Web3, the news wires have been saturated with NFT and Metaverse buzz in 2022. While NFTs and the Metaverse gain pace, the ever-expanding universe of digital assets is shrouded in regulatory uncertainty. Despite persistent regulatory uncertainties and questions about how NFTs should be classified in some jurisdictions, the messaging service LINE has gone NFT.
LINE NFT debut
LINE announced the debut of LINE NFT, a Japanese NFT marketplace, on Wednesday. LVC Corporation, which manages LINE’s crypto and blockchain companies, introduced LINE NFT. Users of the LINE NFT platform can buy, sell, and store NFTs in their LINE BITMAX Wallet. LINE NFT holders can send and receive NFTs with their LINE friends. Around 40,000 NFT products will be available first through LINE NFT. According to LINE, there are over 90 million LINE users in Japan alone.
LINE NFT under no governance
There is currently no law in Japan that governs NFTs. Crypto assets, such as Bitcoin (BTC), are digitally recorded property values that can be transferred via electronic processing platforms and used as a form of payment NFTs, on the other hand, do not serve a similar economic purpose and so cannot be classified as crypto assets. There is a danger of unpredictability in regulatory action unless precise rules on the classification of NFTs are established.
Some lawmakers may be surprised by the launch of LINE NFT, especially given the demographics of LINE users in Japan. In terms of regulatory control, NFTs are similarly in a grey area in the United States. Platforms may fall foul of regulators as a result of the regulatory uncertainties.
Sands Vegas Casino Club, a virtual casino, issued a cease-and-desist order this week for selling NFTs to fund its activities. The NFTs were an illegal security offering, according to Alabama and Texas state statutes. In the OpenSea marketplace, the Sands Vegas Casino sells NFTs. The proceeds from the sale of NFTs go toward the creation of metaverse casinos. The Sandbox (SAND), Decentraland (MANA), Infinity Void, and NFT Worlds are among the prominent metaverses that casinos are targeting.
Coinbase is preparing to launch Coinbase NFT when the cease-and-desist orders are issued. Given the present expansion in the number of NFT platforms, regulatory monitoring is likely to increase. A more competitive playing field might eat into trading volumes for prominent NFT markets like OpenSea.
OpenSea trading volumes of LINE NFT
Leading NFT markets have seen trading volumes fall since a January high. FX Empire revealed that OpenSea trade volumes fell for the second month in a row in March. Increased competition, as well as any changes in the regulatory landscape, will have an influence on trading volumes. Because of the introduction of new marketplaces, OpenSea and other major NFT marketplaces may be forced to extend their products, which may result in more regulatory scrutiny.
The upsurge in NFT trading activity and criminal activities grabbed the attention of UK lawmakers this year. Members of the British Parliament have reportedly requested that the government put stricter rules on cryptos and NFTs. The US government has taken a similar attitude, with Vice President Joe Biden signing an Executive Order to address the issue of digital assets.