Boring Ape NFT wins big win: Court says they are not securities

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A U.S. federal judge abandoned a high-profile investor lawsuit that accused Yuga Labs of selling unregistered securities through the boring APE Yacht Club (BAYC) NFTS and APECOIN.

The decision made by Judge Fernando M. Olguin found that the plaintiff did not meet the legal test of the investment contract.

The lawsuit, reportedly dates back to 2022, aims to force the law to rule that the token is securities; the court disagreed and dismissed the case.

Judge finds Howey test is not met

Judge Olkin ruled that the plaintiff failed to show that all three steps of the Howey test were met. According to the report, the court said the buyers were not proven to have a common business with Yuga’s efforts and had no commitment to come from Yuga’s work.

The judge stressed that many BAYC sales constituted collections and membership benefits rather than investment contracts.

Source: US District Court Central District of California.

Plaintiff once claimed profit expectations

Investors believe that markets talk about trading and rare characteristics create profit expectations. However, the court found these claims too thin to convert collections into safe.

The ruling states that the fate of the buyer is not directly dependent on Yuga’s future business actions, as required by the Securities Act. This narrow view makes the complaint unnecessary legal foothold.

Regulators remain vigilant

The report said the SEC has taken enforcement steps in other NFT cases, meaning the space is still under close regulatory scrutiny.

Historical actions pointed out by regulators include examples related to projects that provide revenue sharing or paid promotions. The courts do not always provide a consistent interpretation of their findings.

This uncertainty means that even after the ruling, the creators and platforms may face legal exposure.

Not the complete shield of NFT

Legal experts warn that the ruling does not mean that all NFTs have no securities claims.

Yuga Labs itself also faces other legal struggles. In July 2025, the Court of Appeal overturned Yuga’s $8.8 million judgment won by the trademark dispute and sent it back to trial. Mixed results in related litigation show that the court is treating each case with its own facts.

With a major challenge dismissed, the decision is expected to provide some assurances for NFT holders and the market.

Nevertheless, if challenged, those promised revenue sharing, profit split or mainly due to investments that may attract different outcomes. The ruling is useful, but not a universal safe haven.

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