31/07/2024 DraftKings Dumps NFT Business, Citing Legal Developments

The sports gambling company faces a class action lawsuit alleging its NFTs are securities.

Sports gambling company Draftkings is shutting down itsnon-fungible token(NFT) business "effective immediately," the company said in an email to customers, ending a high-flying crossover between digital collectibles and sports culture.

"After careful consideration, DraftKings has decided to discontinue Reignmakers and our NFT Marketplace, effective immediately, due to recent legal developments. This decision was not made lightly, and we believe it is the right course of action," the email said.

SEC commissioners slam agency after $750K Flyfish Club NFT settlement
Coinbase-Led Advocacy Group Launches Legal Defense Fund for NFT Projects
NFT Oasis Raises $4.4 Million in Financing and Opens a Bridge to the Metaverse Enabling Creators to Reach the Masses Using Virtual Reality

Weeks ago, a federal judge allowed a class action lawsuit against DraftKings to proceed after finding plaintiffs "plausibly pled" DraftKings' NFTs were unregistered securities, according toWestlaw.

DraftKings entered the NFT business in mid-2021 after noticing its "golden" customers were embracing digital collectibles from NBA Top Shot and other projects, co-founder Matt Kalish said last year in apodcastfrom Ark Invest.

Built around an in-house marketplace, DraftKings' NFT business "let us play in this space that could become, in the next couple of decades, gigantic," Kalish said on the podcast. The company hired blockchain engineers, built its tech atop Polygon network, and started with a Tom Brady-themed collection that quickly sold out.

Though collectors' appetite for plain Jane NFTs had fizzled by 2022, DraftKings stuck with web3 via Reignmakers: a fantasy sports game powered by NFTs. On the Ark podcast Kalish said it captured all the things DraftKings customers loved, from day-trading to fantasy gaming.

"We were really looking to build the best utility-driven, NFT product out there, and we saw some really great momentum" in the first few months, Kalish said on the podcast. Its internal sales figures convinced DraftKings to expand from Football to UFC and PGA.

This year, DraftKings started getting hit with class action lawsuits alleging its NFT salesviolated securities laws, a charge other sports-themed NFT companies had also grappled with. In June, NBA Top Shot settled its own legal snafu with a $4 million payout.

The class action against DraftKings appears to be headed to trial, according to court records.

As part of the NFT shutdown DraftKings is offering buyouts to Reignmakers players, the email said. NFT collectors will still be able to access and transfer their collections.

"It's important for all companies wading into the NFT and collectibles space to be buttoned up legally or else you risk an outcome like DraftKings," said Joel Belfer, who runs the Mint Condition blog on sports collectibles. "It's not the first or last time we’ll see a company face legal challenges and halt an offering due to running up against securities laws."

Arts

https://www.coindesk.com/business/2024/07/30/draftkings-dumps-nft-business-citing-legal-developments/amp/

Interesting NFTs
#70912
By OthersideDeployer
CALICOOL CARLY
*hissing noises*! I'm CALICOOL CARLY. I enjoy sweating through my feet, breakdancing, and eating lasagna. I once got in a fight with a dolphin, and won. I look forward to reading garfield with you.
The Rabble
The Rabble on the TV.
trump 2020
This is a photo i took of my son playing around in one of our cat carriers, redressed to express the concern and damage the continuation of the trump administration could bring to the world in 2020 and beyond. Unlike the majority of my historic work found on opensea, all content was conceived and taken by me, so felt perfect to use as my first piece on Known Origin.
Beautiful Worlds
Welcome to the ‘Beautiful worlds’ where nature and technology have merged into a single entity. These are Ai generated and hand finished visions of solarpunk future in which I would really like our future generations to live and prosper: the future we might have if we took the very “alternative route” which now lies before us: replacing states and corporations which free federations of communities and cooperatives, using decentralist and ecological technologies to create a world beyond economic scarcity and social hierarchy, defined by autonomy, mutual aid, diversity, and inclusiveness. The long-term goals of solarpunk are freedom and well-being for all by adopting and developing such ecological technologies as: solar, wind, wave and geothermal energy rather than oil or gas to generate electricity; a world of decentralized eco-cities, permaculture and vertical farming, free and open-source software, open-source hardware, small-scale fabrication laboratories, micro-manufacturing, 3D-printing, and countless examples of commons-based peer-production online: meeting the maximum amount of needs, in the shortest time, using the minimum possible amount of energy. It’s a world of decentralized and confederated eco-communities, using technology for human-centric and eco-centric ends rather than for accumulating power and profit – mending the metabolic rift between first nature (the natural world) and second nature (human culture) – and where social hierarchies of race, gender, sexuality, and disability are considered horror stories from the past “oil age”. Solarpunk desires societies of polycultural ethnic diversity and gender liberation, where each person is able to actualize themselves in societal environment of free experimentation and communal caring; This philosophy proposes that in order for the social and natural worlds to reconcile, humans must first transform their relations to each other – recreating society along egalitarian, cooperative, and democratic lines – and then transform their relations towards nature – adopting an attitude to cooperation, rather than domination, towards the planet and its nonhuman forms of life. Text by Connor Owens. This artwork took me a year to create and for you it will take a year to discover. Master autonomously updates once a day at 12am with one of 366 original artworks. Enjoy!