Immutable receives SEC Wells notice over 2021 IMX token sales

The United States Securities and Exchange has targeted blockchain gaming platform Immutable, aiming for a listing and private sale of its IMX token potentially in 2021.

According to Immutable’s Nov. 1 statement, the SEC issued an “expedited” Wells notice after the initial interaction in which it informed the company that the Wells notice would be sent “within a week” but would instead be delivered “within hours.” .

Immutable highlighted the vague nature of the notice, stating that it “simply quotes legal provisions” with “less than 20 words of substantive explanation” and offers little meaningful detail about the focus of the investigation. The company believes the agency’s claims could target a “listing and private sale” of its native IMX token in 2021.

Shortly after the notice was published, the SEC had a call with the firm and expressed concerns about a 2021 blog post detailing Immutable’s early investment in Huobi Ventures’ IMX at a pre-launch price of $0.10 “at a preliminary price of $10.” He reportedly said. -100:1 split” stated that there was no “value change” in the agreement.

Immutable disputes this claim, arguing that the investment is in fact legitimate and supported by “real valuation.”

The firm added that it was “confident in its position” regarding the classification of the IMX token and was pushing back against what it described as the SEC’s “indiscriminate assertion that tokens in the industry are securities.”

Immutable called for a “robust conversation to clarify the facts” and expressed a willingness to challenge the SEC’s enforcement approach if necessary.

Reacting to the news, Immutable co-founder Robbie Ferguson reiterated the company’s position of “defending digital ownership in games,” joining contemporaries like Robinhood and OpenSea in defending against the SEC’s allegations.

Immutable received a Wells notice from the SEC, the latest in a series of regulatory approaches through enforcement.

We are ready to do our part, join companies fighting for crypto and defend digital ownership in games.

Read our full article: https://t.co/uIiLlboJ2N https://t.co/589IfARu7x

— Robbie Ferguson 🅧 | Literal (@0xferg) 31 October 2024

While Wells’ notice does not guarantee official action, the development comes as a blow to Immutable’s IMX token, which is down more than 14% at press time.

Led by Chairman Gary Gensler, the SEC has consistently gone after crypto companies for allegedly violating securities laws. This also sparked backlash from US policymakers, who said Gensler was creating confusion in the digital asset space by introducing terms like “cryptoasset security.”

However, the regulator remains unimpressed, having recently issued a Wells notice to Crypto.com. In response, Crypto.com filed a lawsuit challenging the commission.