In a recent court filing, the US District Court Judge for the Southern District of New York has ruled that emojis such as the rocket ship, stock chart, and money bags signify a financial return on investment, and such attract legal actions.
In a tweet, former United States Securities and Exchange Commission (SEC) division head Lisa Braganca cautioned users about the possible legal ramifications of using emojis that may suggest future profits. She posted on Twitter:
Braganca provided a link to a court document in which federal judge Victor Marrero refused Dapper Labs’ petition to dismiss the revised case stating that its NBA Top Shot Moments breached security laws.
In brief, the court noted that several tweets from the NBA Top Shot Twitter account include emoticons implying financial rewards.
“Even though the term ‘profit’ does not appear in any of the tweets, the ‘rocket ship’ emoji,’ stock chart’ emoji, and money bags’ emoji all objectively represent the same thing: a financial return on investment,” they said.
The top legal officer of the NFT platform Enjin, Oscar Franklin Tan, also remarked on the subject. Tan said that the Dapper Labs ruling should not establish a “dangerous norm” that emojis are security for NFTs.” Tan clarified that:
“Courts should protect the edgy, freewheeling messaging in NFT communities because shitposts and emojis are part of free speech too.”
Tan claims that sneaker resellers might utilize the same “FOMO” or “fear of missing out” pitch and the emojis used in the case.
Members of the crypto community responded to the warning with various tweets. One Twitter user called the news “tragic,” while another noted that the First Amendment no longer protects emojis. Meanwhile, a user chose to declare the significance of their emoji use.
On February 23, attorneys responded to the judge’s decision to proceed with the case against Dapper Labs. Attorney for the United States Jacob Chervinsky said it would be “absurd” for a U.S. court to consider private blockchain assets securities.
Chervinsky noted that this may result in the SEC regulating every major video game producer, ticketing site, and travel rewards program.
Similarly, the manner in which the SEC pursued Terra caught the attention of attorneys. On February 17, crypto attorneys took to Twitter to discuss the SEC’s allegations that Terra offered a suite of crypto asset instruments.
Mike Selig, an attorney for Web3, argued that everything is a security under the notion, while Justin Browder, an attorney for Browder, called the SEC’s actions “crazy.”
