OpenSea halts NFT trading from DAO Turtles; project members disagree with the decision

The NFT marketplace OpenSea has suspended trading of pixel turtles from the DAO Turtles, allegedly due to rule violations.

We wanted to share our correspondence with @opensea https://t.co/Hje0M8BR8X #freetheturtles #NFTCommunity

— DAO Turtles (@DAO_Turtles) October 8, 2021

Representatives of the DAO Turtles submitted a blocking request to OpenSea support. In response they were pointed to violations of the rules for “carrying out financial activities requiring registration or licensing, including listing or purchasing securities, commodities, options, real estate, or debt instruments”.

Among other possible grounds for the ban is “participation in fundraising, including creation, listing or purchase of assets that are exchangeable for financial instruments, providing rights to participate in ICO or securities offerings”.

The DAO Turtles noted that they had not violated OpenSea’s rules. As evidence they cited the Axie Infinity project with a trading volume of around $100 million. The representatives now await a response from the platform.

Since the release on October 4, the 10,000-NFT DAO Turtles collection has traded 570 ETH (about $2 million at the time of writing).

In September fired an employee accused of insider trading. The name is not explicitly mentioned in the press release. The crypto community suspected Chief Product Officer Nate Chastain of wrongdoing.

Later OpenSea CEO Devin Finzer said that the employee’s actions were mischaracterized. In the platform’s view, they did not fall under the SEC’s insider trading rules.

In August, OpenSea surpassed $3 billion in NFT trading volume. In the same month the marketplace reported a staff shortage.

In September, an OpenSea glitch led to the destruction of 42 NFTs valued at $100,000.

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