OpenSea is pressing U.S. regulators for clarity on how NFT marketplaces are classified under federal securities law. In a formal letter dated April 9, the company’s general counsel Adele Faure and deputy general counsel Laura Brookover asked SEC Commissioner Hester Peirce to publicly confirm that platforms like OpenSea should not be treated as securities exchanges or broker-dealers.
The request follows the SEC’s decision earlier this year to end its investigation into OpenSea without pursuing enforcement action. Though seen as a regulatory green light by some in the industry, OpenSea’s leadership now seeks clear and durable guidance to prevent future legal ambiguity.
At the heart of the request is a concern that applying broker-dealer or exchange rules to NFT platforms would mischaracterize their function. OpenSea argues it merely facilitates peer-to-peer digital asset transactions and should not fall under the same regulatory umbrella as traditional securities infrastructure.
OpenSea Rejects “Exchange” Label in SEC Filing
OpenSea is drawing a firm line with regulators, asserting that it doesn’t meet the legal standard of a securities exchange or broker under current U.S. law. In its letter to the SEC, the company argued that unlike a traditional trading platform, it does not execute trades, act as an intermediary, or handle customer assets.
Describing itself as a digital bazaar rather than a financial exchange, OpenSea says its core function is to connect buyers and sellers of NFTs—not to facilitate the trades directly. The platform emphasized that it neither provides investment advice nor structures deals—key factors that would otherwise place it under broker-dealer scrutiny.
Looking ahead, OpenSea has asked the Commission to consider formally exempting NFT marketplaces from upcoming broker regulations. The request signals mounting industry concern that overbroad regulatory definitions could stifle innovation in the rapidly evolving NFT sector.
SEC Pullbacks Coincide With NFT Market Decline
OpenSea’s appeal for regulatory clarity comes in the wake of a broader shift inside the SEC. In February, the agency dropped multiple investigations into high-profile crypto firms—including its probe into OpenSea itself—signaling a softening stance under the Trump administration’s more crypto-aligned leadership.
The timing reflects a broader recalibration in Washington, where regulators have largely embraced digital assets amid booming Bitcoin prices and growing institutional interest in DeFi. Still, critics argue that the new administration’s hands-off approach may be as much about self-enrichment as it is about innovation.
While much of the crypto market has seen a resurgence, the NFT sector remains a notable exception. Once a speculative frenzy, NFT activity has plummeted over the past two years. In 2024, global NFT trading volume fell by 19%, while overall sales dropped 18%—their lowest since the 2020 cycle.
Against that backdrop, OpenSea’s request also doubles as a strategic survival move. With volumes down and regulatory definitions still vague, the platform is pushing for clarity before momentum—or enforcement—returns.
Quick Facts
- OpenSea has formally requested the SEC to clarify that NFT marketplaces are not classified as securities exchanges or brokers.
- The SEC concluded its investigation into OpenSea in February without pursuing enforcement action.
- The NFT industry continues to face regulatory uncertainty, with prior SEC actions targeting NFT creators for alleged unregistered securities offerings.
