Article Update: Nonfungible token (NFT) collections have made headlines this holiday season as their founders announced that they will be giving away company equity to NFT holders. Pons Asinorum, the founder of “The Plague” NFT collection, revealed on December 25 that NFT holders will receive a percentage of company shares based on the number of unlisted NFTs they possess. Despite potential legal and regulatory risks, Pons Asinorum claims the move is legal as the shares were not sold. They consulted with lawyers to ensure the legality of the action and emphasized that NFT holders did not anticipate receiving shares when they purchased their NFTs. Pons Asinorum stated that they made this decision to show appreciation to the community that contributed to their brand’s growth, and they believe it is a completely unexpected gesture. Only their legal team was aware of this plan.
Shortly after this announcement, another NFT collection founder followed suit. On January 1, Ovie Faruq, co-founder of Rektguy (also known as OSF in the NFT space), announced that Rektguy NFT holders would receive equity in their company, Rekt Brands Inc. Faruq described this as a gift to collectors who supported Rektguy as an art project. They clarified that trading the NFTs would not transfer any equity and expressed confidence in the legality of their actions. Faruq mentioned their behind-the-scenes efforts to ensure compliance and value in this endeavor.
The Plague has generated over $7 million in all-time sales volume, while Rektguy has surpassed $28 million, according to NFT tracker CryptoSlam.
Community members have responded to these announcements, debating whether these moves are a gamechanger or a mere facade. Waleswoosh, a researcher-in-residence at Azuki, believes that under specific circumstances, this practice can be legal. They explained that in both cases, the eligibility criteria were already established in the past, and the NFTs were not initially sold with the intent of offering equity.
Furthermore, some community members expressed hope that other brands would recognize the implications of these actions. They suggested various ways to implement similar strategies and provide real equities, such as allocating a percentage of sales to specific NFT holders.
Cointelegraph attempted to reach out to Faruq for comment but did not receive a response.