Stand With Crypto, a political advocacy group led by Coinbase, launched a legal defense fund for non-fungible token (NFT) projects, according to a Sept. 13 post on the X platform.
Dubbed the Creator Legal Defense Fund, the $6 million fund is backed by venture capital firm a16z and NFT marketplace OpenSea. According to Stand With Crypto’s website, it is also backed by law firms, including Fenwick & West LLP, Goodwin Procter LLP, and Latham & Watkins LLP.
“With the SEC issuing OpenSea a Wells notice, as well as other attacks on artists and creators, it has become clear that those looking to build on blockchain technology will continue to face significant legal threats and challenges,” according to the website.
“Today, we raise our shield to protect a foundational part of the crypto community,” Stand With Crypto said. “Creatives can now stand up to misguided actions from the SEC.”
Stand With Crypto launched an NFT legal defense fund. Source: Stand With Crypto
Related: OpenSea marketplace receives Wells notice from the SEC
The cryptocurrency industry has been the target of numerous enforcement actions by United States regulators. In August, the Securities and Exchange Commission (SEC) served a Wells notice — a precursor to a lawsuit from the agency — to OpenSea alleging the NFT marketplace sold unregistered securities.
NFTs are tokenized proofs of ownership of a specific item, such as digital art, music, or videos. They are typically valued and traded as collectibles rather than conventional investment instruments.
The SEC has also brought actions against cryptocurrency exchanges Coinbase, Binance, and Kraken, alleging securities law violations related to fungible tokens, such as Solana’s native token, SOL.
“Investors in crypto assets offered or sold as securities should get the same protections as investors in other securities, even when they are traded using intermediaries,” the SEC said in an August statement.
Coinbase has emerged as an especially vocal crypto advocate. After launching Stand With Crypto in 2023, the exchange donated tens of millions of dollars to Fairshake, a crypto industry political action committee (PAC). A16z was also among the PAC’s largest donors.
Stand With Crypto ranks candidates in US federal elections from ‘A’ to ‘F’ based on support for pro-crypto policies. It gives Republican presidential candidate Donald Trump an ‘A’ rating and has not yet determined a rating for Democratic presidential candidate Kamala Harris.
Harris was nominated in August after President Joe Biden stepped back from the presidential race, citing health issues. According to campaign finance watchdog Open Secrets, Fairshake disbursed approximately $93 million during the 12 months prior to August to influence the 2024 election cycle.
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