Germany’s Federal Financial Supervisory Authority (BaFin) is not yet ready to classify NFTs as securities. The agency recommends classifying NFTs on a case-by-case basis.
On March 8, BaFin published a note explaining NFTs and their legal classification. At present, regulators have not found that NFT meets the standards of tradability and cannot regulate and identify securities. However, in the future BaFin may consider NFTs as securities, for example, if 1,000 NFTs represent the same repayment and interest claim.
According to another reservation, NFTs can be considered investments if they contain documentation of mining rights or ownership, such as a promise to allocate.
When it comes to the “crypto-asset” status of NFTs, the agency recommends a case-by-case approach. However, according to BaFin, due to the lack of instant exchange, the chances of NFT representing a “crypto asset” are even smaller than investment classification. The lack of standardization also makes NFT out of the status of “cryptocurrency”.
Due to classification difficulties, BaFin does not expect NFTs to comply with the licensing requirements of the Payment Services Regulation Act. And, with the exception of non-fungible assets that fall under the category of financial instruments, NFTs have so far not been subject to BaFin’s anti-money laundering (AML) oversight. Other than those cases, NFTs can still be considered “crypto-assets” on their own.
According to Metaverse platform Metajuice, nearly three-quarters of NFT collectors on its platform buy NFTs for their status, uniqueness, and aesthetics. Only 13% of survey respondents said they were buying NFTs to resell in the future.
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As reported by Cointelegraph