Non-Fungible Insights: Blockchain Decrypted

On November 18, 2024, in Samuels v. Lido DAO, the United States District Court for the Northern District of California denied some defendants’ motions to dismiss, finding that the plaintiff sufficiently alleged that a decentralized autonomous organization (DAO) is a partnership under California law, and consequently that these defendants may be liable as general partners. The court relied chiefly on the plaintiff’s argument that these defendants “meaningfully participated” in the DAO’s governance.

On February 17, 2023, the Securities and Exchange Commission charged former NBA star Paul Pierce—nicknamed “the Truth”—with violations of Section 17(b) of the Securities Act of 1933, as amended, which makes it unlawful for any person to promote a “security” without fully disclosing the receipt and amount of compensation received for such a promotion. Section 17(b) is known as the SEC’s “anti-touting rule.”

On February 13, 2023, Paxos Trust Company, LLC, a New York State-chartered trust company regulated by the New York State Department of Financial Services, confirmed via a statement that it received a Wells Notice from the Securities and Exchange Commission on February 3, 2023.

On February 9, 2023, the U.S. Securities and Exchange Commission announced charges against Payward Ventures, Inc. and Payward Trading Ltd. for failing “to register the offer and sale of their crypto asset staking-as-a-service program.”