Sorare, a France-based fantasy sports company, has been accused of offering unauthorized gaming services in the United Kingdom. This is the Gambling Commission’s first step towards a blockchain-based virtual gaming platform.
Sorare’s NFT Platform Called Illegal in the UK
Based in Saint-Mandé, France, Sorare provides fantasy games that offer the ability to buy and sell NFT collectible cards based on football, basketball and baseball events.
Sorare has recently partnered with major sports leagues such as the English Premier League and the German Bundesliga. NFTs are singular digital tokens that represent assets within the platform.
A Priority Step for Web3 Edits
However, this decision is perhaps the biggest precedent-setting step for future Web3 regulations. As the Gambling Commission’s first regulatory action on a blockchain entity, this decision could shape regulators’ approach to Web3 and NFT-related companies.
“Sorare is accused of providing gambling services without a business licence, contrary to sections 33(1), (4) and 36(3), (3A) of the Gambling Act 2005.”
The company was summoned to appear at Birmingham Magistrates’ Court on October 4 following a three-year investigation launched by the UK Gambling Commission. The investigation, launched in 2021, aimed to investigate whether a gambling license was needed for Sorare to operate. This move could have a potential impact on determining regulators’ approach to Web3 and NFT-related companies, as this is the first time the commission has acted with blockchain operators.
Increased Regulation of the Crypto Industry in the UK
This development also demonstrates the increasing scrutiny of UK regulators against suspected illegal activities regarding the crypto sector. In particular, similar recent moves towards unregulated crypto ATMs are indicative of this increase.
Sorare has flatly denied that his platform does not constitute a gambling product under the laws of England and Wales. The board stated that regulators misunderstood the business model and applied the wrong gambling laws.
This case could set an important precedent for how Web3 and NFT-based platforms will be evaluated in the regulatory environment. Other surviving crypto companies may face similar regulations in the UK. It is of great importance for businesses to carefully examine the laws in the regions in which they operate.
Disclaimer: The information contained in this article does not constitute investment advice. Investors should be aware that cryptocurrencies carry high volatility and therefore risk, and should carry out their transactions in line with their own research.
