Was trading NBA Top Shots actually like trading stocks? A lawsuit will decide

Dapper Labs and its CEO, Roham Gharegozlou, are facing a lawsuit accusing them of selling unregistered securities in the form of NBA Top Shot Moments. Three plaintiffs, Gary Leuis, Jeeun Friel, and John Austin, claim Dapper Labs made hundreds of millions of dollars in profit and propped up the market for Moments by preventing users from withdrawing money. Despite Dapper\’s lawyer\’s claims, a judge let the case go forward. The plaintiffs allege that Dapper Labs\’ offer of the NFT, Moments, was an offer of an “investment contract” and therefore a “security,” required to be registered with the SEC. They point to a tweet about a $208,000 transaction for a LeBron James Moment as evidence that Dapper Labs didn\’t stop Top Shot users from viewing and referring to their purchases of Moments as investments. At its peak in March 2021, NBA Top Shot had 184,000 active buyers, but now only 12,000 unique buyers this month. The courts will ultimately decide whether Dapper Labs was selling unregistered securities or “formed products”, but interest in NBA Top Shot Moments has dropped significantly. Follow my Facebook group for updates on this case and more news about NBA Top Shot Moments.

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