Draftkings platform to stop trading NFTs after lawsuit over trading in unregistered securities

Users of the NFT game Reignmakers will be able to redeem their in-game assets

31.07.2024 - 12:37

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2 min

Last updated on Aug 6, 2024

What’s new? Sports gambling platform Draftkings has shut down its non-fungible token (NFT) business, citing recent regulatory changes. The court had previously accepted a class action lawsuit that referred to the NFTs offered by DraftKings as unregistered securities.

Material by CoinDesk

What else is known? DraftKings launched an NFT marketplace based on Polygon blockchain technology in mid-2021. The platform specialized in selling sports-related collections such as NBA Top Shot. The first collection successfully sold on the new platform was an NFT set dedicated to American football player Tom Brady.

Last year, DraftKings co-founder Matt Kalish noted that launching its own site would allow the company to tap into a market that would grow to huge proportions over the next couple of decades.

While the community’s interest in NFT has been fading, the company launched its own NFT game, Reignmakers, in 2022, which executives said was also a success.

This year, however, the company began receiving class action lawsuits alleging violations of securities laws. This is not the first such case involving NFT sports. Last month, the company behind the NBA Top Shot collection settled a class action lawsuit with similar allegations, paying $4 million.

Trump announces the release of a fourth NFT collection

The politician also stated the need to develop the crypto industry in the United States

As for DraftKings, it said in a press release that it has already ceased trading activities within the Reignmakers marketplace and game. Management called the decision a difficult one, but the right one.

Reignmakers players are offered redemption of in-game assets, and NFT collectors on the Marketplace will still be able to access and transfer their collections.

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