Yuga Labs is being investigated by the United States Securities and Exchange Commission (SEC) in determining whether the Bored Ape Yacht Club (BAYC) non-fungible token (NFT) as well as the ApeCoin token are unregistered securities.
It is understood that Yuga Labs is being investigated after being accused of violating federal law in issuing NFTs and how the Ethereum (ETH)-based ApeCoin token distribution process is made.
This follows because the founder of Yuga Labs reaped a lot of benefits immediately after creating the token.
ApeCoin was launched by the Ape Foundation which includes prominent Web3 builders such as Reddit co-founder Alexis Ohanian and FTX Ventures head Amy Wu.
Now the price of ApeCoin is falling after the report was published which is down by 9% in the last 24 hours.
Yuga Labs insists that its company will work with the industry and regulators in developing the ecosystem while the supervisors continue to work to deepen the world of Web3.
For context, BAYC managed to create 10,000 NFT collections at an ETH price of $19 each and made a profit of $319 million.
In fact, NFT BAYC owners will have easy access to communicate with other owners and be able to create and sell their own works of art.
Among other benefits are having Bored Ape Kennel Club (BAKC), Mutant Ape Yacht Club (MAYC) and free ApeCoin allocation.
