IMX Sheds By Double Digits As SEC Sends Wells Notice To Immutable

The US Securities and Exchange Commission (SEC) has issued a “Wells Notice” to Immutable, a blockchain gaming platform. It joins a list of prominent Web3 companies targeted by the agency’s regulatory-by-application approach.

After the news, the price of the IMX token declined by more than 14% in the last 24 hours, below $1.40.

Wells’ abrupt warning to Immutable

In a Nov. 1 blog post, Immutable expressed its frustration at receiving Wells’ notice from the SEC, which the platform said “non-specifically” alleges securities law violations and possible misrepresentations .

Typically, the SEC engages in several months of discussions with a company before issuing a Wells notice, which allows for detailed exchanges and a clearer understanding of the situation. However, in the case of Immutable, this standard process was completely skipped.

Immutable reported that in its first interaction with the SEC, the company was told it would receive a notice from Wells within a week. However, it came within hours and lacked the detailed explanation normally expected in such cases. Immutable claimed that the notice offered only minimal details, with less than 20 words explaining the allegations, which the platform speculates could be regarding its IMX listing from 2021.

This abrupt action was taken with almost no direct communication or context, leading Immutable to question the SEC’s intentions, especially given the timing so close to the US election. It is important to note that this notice often precedes formal enforcement action.

“While the SEC claims indiscriminately that industry-wide tokens are securities, we are confident that the IMX token is not. If the way to provide clarity to the industry is by winning against this attempted regulation through enforcement, then Immutable is happy to do so.”

Immutable ready to fight

The latest development places Immutable alongside industry giants such as Coinbase, Consensys, Ripple, OpenSea, Uniswap Labs, Bittrex and Crypto.com, which have received a Wells notice from the securities regulator. Several players have refused, arguing against the regulator.

Immutable also stated that it remains well capitalized with a large war chest to build for the future of gaming and would fight back if necessary.

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