USA LAW AND PRACTICE Contributed by: Margo H.K. Tank, Michael Fluhr, Era Anagnosti, Kristin Boggiano, David Stier, Liz S. M. Caires, Adam Dubin, Emily Honsa Hicks, Kathleen Birrane and Chezelle McDade, DLA Piper LLP
DATs that invest and trade materially in digital asset interests may have to consider their implications. Advisers that manage a fund holding digital assets must consider several issues, including: • disclosure requirements addressing digital asset risk factors; • fair valuation of assets; • custody; • treatment of assets in bankruptcy; • policies on whether the assets are securities or commodities; • investment thesis documentation addressing why assets fit the portfolio management criteria; • tax considerations; and • SEC compliance in marketing materials. 10.11 Virtual Currencies The term “virtual currency” is used by money and banking regulators to describe a money-like rep - resentation of value. Certain activities concerning cryptocurrencies (ie, virtual currencies), most notably transmission and trading, are subject to regulation by federal and state money and banking regulators. See 6. Marketplaces, Exchanges and Trading Plat- forms . 10.12 NFTs Treasury NFTs (in particular collectibles) have not per se been widely treated as cryptocurrency. NFT trading plat - forms have operated without money transmitter licences and with less scrutiny from financial regula - tors compared to cryptocurrency exchanges. In con - trast, it is well accepted that at least centralised NFT trading platforms must comply with sanctions rules. Treasury released in 2024 a risk assessment of NFTs finding the risk of money laundering or terrorist financ - ing low, but acknowledging that: • Existing AML regulations may not adequately cap - ture all types of NFT and NFT platform activity. • NFT platforms may have BSA and AML obligations, depending on the nature of the underlying activity
and if the NFTs are considered currency or a cur - rency substitute. • All NFT platforms conducting transactions involv - ing US persons are required to comply with sanc - tions regulations. SEC SEC has brought enforcement actions alleging that certain NFT collectibles constituted securities. In 2024, SEC commenced an investigation against OpenSea for the unregistered sale of securities which was dropped in 2025. It remains unclear how much SEC will continue these efforts or how courts would respond if challenged. Separately, buyers of NFTs have brought private civil actions asserting claims under federal securities laws. Although early court decisions found that plaintiffs plausibly alleged NFT collectibles constituted securi - ties, at least one court recently dismissed a lawsuit against an NFT collectible seller that controlled neither the underlying blockchain nor any marketplace. 10.13 Stablecoins Stablecoins have generally been regulated similarly to other cryptocurrencies. Centralised issuers and trad - ing platforms are required to register with state and federal regulators as money transmitters, while the decentralised sale and trading of stablecoins remains in a relative regulatory grey area. Additionally, in July 2025 the GENIUS Act was signed into law. The Act establishes a comprehensive legal framework for the issuance and regulation of “pay - ment stablecoins” – defined as a digital asset: • that is, or is designed to be, used as a means of payment or settlement; and • the issuer of which: (a) is obligated to convert, redeem, or repurchase for a fixed amount of monetary value, not including a digital asset denominated in a fixed amount of monetary value; and (b) represents that such issuer will maintain, or create the reasonable expectation that it will maintain, a stable value relative to the value of a fixed amount of monetary value.
977 CHAMBERS.COM
Powered by FlippingBook