End of the secrecy for NFTs in the USA - This new law changes the game

End of the secrecy for NFTs in the USA – This new law changes the game

NFTs will no longer be able to play hide and seek – A US federal agency requires that senior officials be transparent regarding their holdings non-fungible tokens (NFT).

Lifting the veil on NFTs at the highest level

Emory Arthur Rounds IIIdirector of theOffice of Government Ethics of the United States, signs the end of the opacity around the possession of NFT by politicians. In a legal opinion dated July 15, it now imposes on senior officials an obligation to disclosure of their investments in non-fungible tokens.

Most NFTs will not be able to slip through the cracks put in place by the numerous provisions contained in the notice. One of them indicates that“at the end of the reporting period”the parties concerned are required to be transparent about their NFTs, which are “held for the purpose of investment or the production of income”and whose value amounts to at least $1,000.

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Profitable investments under closer scrutiny

The rule applies to both split NFTs and collectibles. She is even more binding for investments that have generated a profit exceeding a certain threshold and who then do not benefit from this margin of 1,000 dollars.

The notice clarifies that senior officials who have made a profit over $200 on their NFTs during the reporting period must disclose their investments, independently the value of their non-fungible token holdings.

Transparency: the personal and family exception

Declarants must therefore expose themselves, or almost. The notice compels them to disclose purchases, sales and trades of NFTs related to collectibles, and fractional NFTs “considered as securities”.

Only NFTs that would be linked to personal property, family or a houseworkand which would thus be used in these frameworks, and not for investment purposes or to produce income, escape to this reporting obligation.

NFTs are now on the radar of the United States Government Ethics Office. The transparency certainly allowsavoid conflicts of hidden interests, as the country’s authorities continue to work on the regulation and legislation of digital assets in general. This declaration obligation can, moreover, be seen as a logical consequence of the entry of NFTs into politics, with a former developer of decentralized finance who planned to finance his election campaign with non-fungible tokens.

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