TechFlow, May 21 — According to Cointelegraph, SEC Commissioner Hester Peirce stated that most non-fungible tokens (NFTs), including those with creator royalty mechanisms, likely fall outside the scope of federal securities laws.
Peirce noted that NFTs enabling artists to earn resale proceeds would not automatically be classified as securities. She compared this model to compensation mechanisms for musicians and filmmakers on streaming platforms. Oscar Franklin Tan, Chief Legal Officer at Atlas Development Services, a core contributor to Enjin, said U.S. securities laws primarily focus on investment regulation rather than creator remuneration. Royalty income received by creators resembles commercial revenue, not investment returns, and the SEC has never prohibited artists from collecting royalties via blockchain protocols on secondary sales of their works.
