A recent ruling by a United States District Court judge for the Southern District of New York has stated that certain emojis, such as the rocket ship🚀, stock chart📈, and money bags💰, can be interpreted as indicating a “financial return on investment.”
https://twitter.com/LisaBraganca/status/1628868429540126720?ref_src=twsrc%5Etfw%7Ctwcamp%5Etweetembed%7Ctwterm%5E1628868429540126720%7Ctwgr%5E6ca8c7d5335f074589eafa8122e78aee4d8652f9%7Ctwcon%5Es1_&ref_url=https%3A%2F%2Fcointelegraph.com%2Fnews%2Femojis-count-as-financial-advice-and-have-legal-consequences-judge-rules
The ruling came as part of a decision denying Dapper Labs‘ motion to dismiss an amended complaint alleging that its NBA Top Shot Moments violated security laws.
NBA Top Shot Moments, created by Dapper Labs, are gaining popularity among sports fans and collectors as a blockchain-based collectible. These officially licensed NBA collectibles feature short video clips, or “Moments,” of NBA players in action and have already sold for hundreds of thousands of dollars.
Former SEC branch chief Lisa Braganca warned that the use of such emojis could have legal consequences, tweeting: “Users of these emojis are hereby warned of the legal consequence of their use.”
However, Oscar Franklin Tan, the chief legal officer of NFT platform Enjin, cautioned against creating a “dangerous rule” that could classify all NFTs as securities due to the use of emojis.
Despite these concerns, lawyers have reacted positively to the judge’s decision to allow the lawsuit against Dapper Labs to proceed. U.S. attorney Jake Chervinsky pointed out that considering assets on private blockchains as securities would be “absurd,” potentially subjecting every major video game developer, ticketing platform, and travel rewards program to SEC regulation.
However, the SEC’s recent action against Terra, which it accused of selling a suite of crypto asset securities, has led some lawyers to express concern that the agency’s actions are becoming increasingly “wild.”
Members of the crypto community have responded to the ruling with mixed feelings, with some describing it as “tragic” and others noting that it represents a limitation on freedom of speech.
Some have also pointed out that the same emojis could be used by sneaker resellers to promote their products, raising questions about whether such sales would also be subject to SEC regulation.
The ruling is likely to have significant implications for the use of emojis in financial messaging, particularly in the context of cryptocurrency and NFTs.
While some have expressed concern that it could stifle creative expression in these communities, others have argued that it is necessary to protect investors from misleading or fraudulent marketing practices.
As the legal landscape around cryptocurrency and NFTs continues to evolve, it remains to be seen how courts and regulators will balance these competing interests.
