Sorare, a fantasy sports company based in France, is accused of offering unauthorized gaming services in the United Kingdom. This marks the Gambling Commission’s initial action against a blockchain-based virtual gaming platform.
Sorare’s NFT Platform Labeled Illegal in the UK
Located in Saint-Mandé, France, Sorare provides fantasy games that allow users to buy and sell NFT collection cards based on football, basketball, and baseball events.
Recently, Sorare partnered with major sports leagues such as the English Premier League and the German Bundesliga. NFTs represent unique digital tokens that signify assets within the platform.
A Significant Step for Web3 Regulations
This ruling could potentially set a significant precedent for future Web3 regulations. As the Gambling Commission’s first regulatory action against a blockchain organization, this decision may influence how regulators approach companies in the Web3 and NFT sectors.
“Sorare is accused of providing gaming services without an operating license, violating sections 33(1), (4), and 36(3), (3A) of the Gambling Act of 2005.”
The company has been summoned to appear before the Birmingham Magistrates’ Court on October 4, following a three-year investigation initiated by the UK Gambling Commission. Launched in 2021, the investigation aimed to determine whether Sorare needed a gambling license to operate. This action could have potential implications for regulatory attitudes towards Web3 and NFT-related companies.
Growing Scrutiny of the Crypto Sector in the UK
This development also illustrates the increasing scrutiny by UK regulators regarding suspected illegal activities in the crypto sector. Similar recent actions against unregulated crypto ATMs signal this rising intensity.
Sorare firmly denied that its platform constitutes a gambling product under the laws of England and Wales, stating that regulators misinterpreted its business model and improperly applied gambling laws.
This case could provide a crucial precedent for how Web3 and NFT-based platforms are evaluated in the regulatory landscape. Other crypto companies that remain operational may face similar regulations in the UK. It is essential for businesses to carefully examine the laws relevant to their operational regions.
