If this happens, Dapper Labs would be required to register the NFT series with the U.S. Security and Exchange Commission.
Some unreliable sources have also reported that the Federal Judges are scrutinizing other assets such as Uno cards and Lego bricks to know if these are also unregistered securities. If Uno cards fulfill the criteria of the distinguished Howey Test they would have to follow the proxy solicitations, tender offers, insider trading, and other security laws.
No one should be amazed if this turns into reality as the U.S. courts are more than dedicated to regulating everything related to blockchain and happiness. While analyzing on a personal level, it's clear that both Uno cards and Lego bricks should be registered security as they pass the Howey Test.
Let us elaborate on fitting in Uno cards on the four criteria to determine whether they are investment security.
A normal deck of Uno cards costs around $10 and that is the invested amount in the commodity. This makes Uno cards eligible to be classified as an investment as the person who is putting that $10 is expecting some return of some joy and happiness from future Uno games. This makes them an investment of money, fulfilling the first criterion of the Howey test.
According to Lawinsider’s definition of common enterprise,
“Common enterprise means an enterprise in which the fortunes of the investor are interwoven with those of either the person offering the investment, a third party, or one or more investors”
In Uno cards, the fortune of the investor (who invested $10 to buy the cards) is heavily involved and interwoven with other investors (those who have invested their time in playing the game). This means a game of Uno is a common enterprise and follows the second criterion of being an investment security.
No one plays Uno without any reason, we all have reasons to start a game and expectations to win it. Winning is not just a random word created to describe the state of conquering, it depicts the mental pleasure one attains by accomplishing it.
All Uno games are played with the expectation of a profit, for gaining this mental pleasure and thus fulfill the third criterion for being an investment security.
No Uno game can be played alone. At least two people are needed to start the game but not all can win it. There is only one winner in the game and the other party has to face the loss. This means, even though all of the players put out the same efforts, not all get the return. The joy of winning was derived from the collective effort of each team member, fulfilling the last criterion of the Howey test.
The U.S. federal judges are more than excited to declare random entities as investment securities and it would not be surprising if the absurdity of our above-mentioned claims become a reality. According to the states, there is nothing as too much regulation and only they are equipped to control the blockchain technology. In reality, no one can.
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