The US Securities and Exchange Commission (SEC) filed a Wells Notice to Immutable over its IMX token sale. The SEC’s contention relates to a 2021 blog post on pre-launch investments made in IMX tokens valued at $0.10 or $10 prior to the 100:1 split.
Immutable questioned the SEC’s ruling, saying the price was unfair; therefore, the charge is “improper” since no exchange has taken place between the parties.
Immutable (IMX) was one of the projects focused on sports in 2021, a time of growing popularity of blockchain play-to-earn (P2E) projects. The blockchain project featured an NFT marketplace and L2 scaling solution, primarily serving third-party game developers.
Immutable received the Wells notice from the SEC, the latest in their de facto regulatory enforcement policy. We found this out within hours of our first interview, with an accelerated timeline to arrive before the election.
Sadly, stories like this are becoming more and more…
– Unchangeable (@Unchangeable) October 31, 2024
Wells Notice Target ‘Sale of IMX Tokens’
Immutable is Australia’s leading blockchain that has launched a $320 million pre-sale. About 14% of IMX tokens went to the public. The SEC believes that the same IMX tokens at the time of launch violated certain rules, hence the decision to file a notice.
In the US, companies and individuals may receive a Wells Notice from the agency if they are being investigated for possible violations. Immutable immediately responded to the notice, saying that the organization was deliberately strong when it was launched despite there being little evidence of wrongdoing.
After the notice was issued, the agency contacted the company for an interview. With the Wells notice filed, Immutable may face a lawsuit soon.
Token Price Drops to One-Month Low
The recent news of Unchangeable and the investigation that may disturb many traders, pushed the price of the token to $1.22 from $1.37, a one-month low. However, the SEC release was also helpful for the company as its open profit volume increased. In fixed, open interest includes coin-margined and stablecoin-margined contracts in USD.
Source: Coinalyze
Recently, IMX’s open interest went from a low of $22 million to a high of $27 million in just a few hours. While many view IMX as risky, analysts see a possible and swift recovery in its decline. Top exchanges, including Coinbase and Binance, carry IMX.
IMX price down in the last 24 hours. Source: CoinMarketCap
Immutable Slams SEC For Its Aggressive Enforcement
Australia’s Immutable has shared its frustration with Twitter/X, saying these notices and investigations are becoming increasingly difficult. The company used the experience of other blockchain companies such as Coinbase, OpenSea, and Uniswap as examples. Immutable added that the agency’s latest aggressive moves now extend to sports.
In the same post, the company reiterated its commitment to the industry and said it will continue to build to support games. If necessary, the company will also fight and protect the rights of players. So far, the SEC’s Wells notifications have not led to the release of a company or project, except for XRP, which was removed from Binance for one year.
Featured image from TechCrunch, chart from TradingView