TechFlow news, September 17 — According to The Block, the U.S. Securities and Exchange Commission (SEC) announced on Tuesday that it has reached a settlement with Flyfish Club, a New York-based restaurant project, which will pay a $750,000 penalty. The SEC charged Flyfish Club with conducting an "unregistered crypto asset securities offering" by selling 1,600 NFTs to U.S. investors and raising $14.8 million.
Flyfish Club planned to use proceeds from the NFT sales to build a high-end membership restaurant and bar in New York City. The SEC stated that Flyfish promoted investor expectations of profits through professional management and informed investors they could profit by reselling the NFTs on secondary markets. Under the settlement terms, Flyfish must destroy all NFTs under its control within 10 days and forfeit future royalty income from any NFT sales.
Republican SEC commissioners Hester Peirce and Mark Uyeda dissented, arguing that Flyfish's NFTs should be considered "utility tokens" rather than securities. They stated: "While members may profit by leasing or selling their tokens, the NFTs serve a specific function: you need one to dine at Flyfish Club."
