Upstream has taken a proactive approach to navigate any regulatory changes on the horizon

By Anastasia Samaras

Upstream, a MERJ Exchange Market, has always taken a proactive, compliance-first approach to our NFT market. We believe regulation is a “when,” not an “if,” and regulator’s latest probes point to why.

Yuga Labs Inc., the entity behind the well-known Bored Ape Yacht Club collection of NFTs, is reportedly being examined by the SEC to determine whether sales of its digital assets are in violation of federal law.

According to a Bloomberg report, the SEC is looking into whether some NFTs are more comparable to stocks and should adhere to the same disclosure regulations. They are also looking into the distribution of ApeCoin to holders of Bored Ape Yacht Club and other NFTs.¹

Earlier this year, according to another Bloomberg report, the SEC allegedly began undertaking inquiries of NFT creators and platforms for potential securities violations, focusing on fractionalized NFTs and whether certain NFTs are being used to raise money like traditional securities.

While these probes don’t mean the agency will sue, it does bring up considerations for companies and exchanges facilitating NFT trades.

Upstream’s position

Upstream, a MERJ Exchange Market, is the first regulated securities exchange to offer NFT trading alongside digital securities. As a trailblazer, our trading app has an innovative methodology capable of supporting NFTs as securities in the global market if the need ever arises.

Upstream screens NFTs offered on our exchange to make sure that they don’t need to be treated as securities and, in addition, has proactively integrated relevant investor protection measures found in regulated securities markets including Know Your Customer “KYC” and Anti-Money Laundering “AML” compliance checks to prevent market manipulation.

As a MERJ Exchange Market, Upstream benefits from MERJ being an affiliate of the World Federation of Exchanges (WFE) adhering to the highest levels of investor protections, issuer disclosures, and KYC/AML compliance. We work with brands across sports, music, and entertainment offering a secure, safe entry-point into Web3. It was paramount to include benchmarks that protect personal brands and their fans and promote longevity no matter the regulatory landscape.

Being a layer-2 Ethereum exchange, Upstream offers a simplified user journey with in-app wallet creation, streamlined compliance checks, and no gas fees charged to users which enables NFT creators to sell free, low-cost, or premium NFTs to fans of all levels who may participate using cash, credit cards, debit cards, PayPal and USDC stablecoin. Hybrid features and perks include “burn and replace” for stolen or lost NFTs; flexible payment options; and FDIC insurance for cash positions for traders.

Upstream’s new wave of NFTs

The first wave of NFTs were speculative, but a new wave being ushered in by Upstream target fan engagement NFTs. We anticipate that this new wave of NFTs will put a strong emphasis on community building, accessibility, and utility. We also anticipate that this new stage of NFTs will bring in an entirely new wave of fans who are not yet familiar with NFTs, Web3, and how exactly it will benefit them.

The use of NFTs as proof of ownership to decorate online identities and strengthen communities has since reached major brands across sports, music, and entertainment; many of which are working with Upstream to tap into the unique use cases blockchain technology can power.


By making NFTs easily accessible, affordable, and compliance-focused, millions of fans can enjoy digital collectibles from their favorite athletes, musicians, and entertainers. Upstream will continue to be proactive and protect our community with forward-thinking solutions and methodology


1 Bloomberg Report

About Upstream

Upstream, a MERJ Exchange Market (, is a fully regulated global stock exchange for digital securities. Powered by Horizon’s proprietary matching engine technology, the exchange enables investors to trade shares in IPOs, NFTs, U.S., and international dual-listed equities, and celebrity ventures directly from the app Interested issuers can reach the team at

About MERJ

MERJ Exchange (MERJ) operates Upstream as a fully regulated and licensed integrated securities exchange, clearing system, and depository for digital and non-digital securities. MERJ is an affiliate of the World Federation of Exchanges (WFE), recognized by HM Revenue and Customs UK, a full member of the Association of National Numbering Agencies (ANNA), and a Qualifying Foreign Exchange for OTC Markets in the US. MERJ is also a member of the Sustainable Stock Exchanges Initiative. Visit to learn more.

About Horizon

Horizon is a fintech company that builds and powers global securities exchanges with an integrated suite of software for compliant issuance, management, and secondary trading of securities. Their in-house solutions combine Wall Street and Silicon Valley to power the next generation of securities offerings and trading in the U.S. and globally. Learn more at


This communication shall not constitute an offer to sell securities or the solicitation of an offer to buy securities in any jurisdiction where such offer or solicitation is not permitted.

NFTs received have no economic value, royalties, equity ownership, or dividends. NFTs are for utility, collection, and display only.

*U.S. investors are not permitted to purchase Upstream listed securities. U.S. and Canadian citizens will only be able to trade in securities they currently own, that have been listed on Upstream, for liquidation purposes only.

If funding Upstream with an ACH or wire bank payment, users must complete Upstream’s in-app KYC process to get their new, FDIC insured, Upstream U.S. bank account details via email. Users may then initiate a funds-transfer from their bank or financial institution to this new U.S. Dollar bank account. If you haven’t completed KYC yet, or didn’t select ‘Bank’ as the ‘Deposit From’ option when you completed the process initially, then please go through KYC again selecting the ‘Bank’ payment method. Users may complete the simple KYC process by tapping the settings icon and the KYC option inside the Upstream app.

Upstream is a MERJ Exchange market. MERJ Exchange is a licensed Securities Exchange, an affiliate of the World Federation of Exchanges, and a full member of ANNA. MERJ supports global issuers of traditional and digital securities through the entire asset life cycle from issuance to trading, clearing, settlement, and registry. It operates a fair and transparent marketplace in line with international best practices and principles of operations of financial markets. Upstream does not endorse or recommend any public or private securities bought or sold on its app. Upstream does not offer investment advice or recommendations of any kind. All services offered by Upstream are intended for self-directed clients who make their own investment decisions without aid or assistance from Upstream. All customers are subject to the rules and regulations of their jurisdiction. By accessing the site or app, you agreed to be bound by its terms of use and privacy policy. Company and security listings on Upstream are only suitable for investors who are familiar with and willing to accept the high risk associated with speculative investments, often in early and development stage companies. There can be no assurance the valuation of any particular company’s securities is accurate or in agreement with the market or industry comparative valuations. Investors must be able to afford market volatility and afford the loss of their investment. Companies listed on Upstream are subject to significant ongoing corporate obligations including, but not limited to disclosure, filings, and notification requirements, as well as compliance with applicable quantitative and qualitative listing standards.

Forward-Looking Statements

This communication contains “forward-looking statements.” Such statements may be preceded by the words “intends,” “may,” “will,” “plans,” “expects,” “anticipates,” “projects,” “predicts,” “estimates,” “aims,” “believes,” “hopes,” “potential,” or similar words. Forward-looking statements are not guarantees of future performance, are based on certain assumptions, and are subject to various known and unknown risks and uncertainties, many of which are beyond the Company’s control, and cannot be predicted or quantified, and, consequently, actual results may differ materially from those expressed or implied by such forward-looking statements. Such risks and uncertainties include, without limitation, risks and uncertainties associated with (i) difficulties in obtaining financing on commercially reasonable terms; (ii) changes in the size and nature of our competition; (iii) loss of one or more key executives or brand ambassadors; and (iv) changes in legal or regulatory requirements in the markets in which we operate. The Company assumes no obligation to publicly update or revise its forward-looking statements as a result of new information, future events or otherwise

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