Checking your NFT collection for regulatory compliance

Web3 is the wild west, but we still play by the rules.

We heartily support innovation in the Web3 space and understand that sometimes folks want to the push boundaries. However, as a US-based company, there are limitations as to what Crossmint's services can be associated with. 

Crossmint cannot be used to mint any NFT that may be classified as a security.

Crossmint performs an analysis with respect to the Howey test to determine the likelihood that an NFT qualifies as an investment contract under U.S. securities laws. 

What is the Howey Test?

1. An investment of money
2. In a common enterprise
3. With the expectation of profit
4. To be derived from the efforts of others
   (sourced from Investopedia)

Is my NFT collection a security?

NFT collections that may be at risk of being considered a security include:

• NFTs that entitle the holder to a perpetual yield or reward that acts as a dividend 
• NFTs marketed as investments, with explicit comparisons to existing securities
• NFT collections that make excessive claims to incentivize holders with promises of future value-add opportunities 
• Crypto miners that split the income generated from the mining operation among the NFTs 

We Can Still Help

If you are unsure about your NFT collection's compatibility with Crossmint, please contact Crossmint support. While we can not support NFT collections that may be considered securities, we encourage you to reach out and explore how we can support you in other ways.

For more information, refer to the following:

• Terms of Service
• Merchant Services Agreement
• Content Policy

Updated August 29, 2023 05:43