OpenSea disables Bored Ape collection due to lawsuit

Due to an ongoing court dispute in Singapore, OpenSea has disabled trading of a non-fungible token issued by the Bored Ape Yacht Club (BAYC).

The world’s largest NFT marketplace, OpenSea, has tagged the digital asset BAYC #2162 for “suspicious behavior”. This mark makes it impossible for the current owner to sell the NFT. Prospective buyers are also not allowed to bid on the product in question.

According to a court filing and a statement from the Singapore law firm, Withers KattarWong, an individual named Rajesh Ramkumar obtained a court order (the first of its kind) issued by the Singapore High Court which stopped the sale of NFT BYC #2162, as a loan agreement was signed under the pseudonym chefpierre.

NFT as valuable property

“It is the first decision in a trade dispute where NFTs are recognized as valuable property worth protecting,” said Shaun Leong, lead attorney in the case. “The implication is that NFT is a digital asset and people who invest in it have rights that can be protected.”

According to The reportRajkumar and chefpierre signed a loan agreement in March using the website NFTfi, which allows NFT owners to “use their digital assets to access the liquidity they need,” according to the website. Rajkumar would hold the BYC #2162 asset on NFTfi as loan guarantee while paying off his debt.

When Rajkumar realized that he needed more time to repay the loan, chefpierre allegedly foreclosed and moved the BYC #2162 asset to his personal Ethereum wallet, where he attempted to sell it at OpenSea. Now, the NFT is in litigation.

While NFTs are falling in popularity and value, this court case could put NFTs in the spotlight by legitimizing them as a bona fide financial asset.

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