Immutable X, a web3 gaming firm, recently made a statement regarding a notice it received from the U.S. Securities and Exchange Commission (SEC) related to the sale of its IMX tokens in 2021. The company expressed its frustration with what it called “regulation by enforcement” and criticized regulators for not offering clear guidance on regulations.
The SEC issued a Wells Notice to Immutable X, which is a letter notifying individuals or companies that the regulator is considering taking legal action against them following an investigation. The notice came shortly after the company’s first interaction with the SEC and provided limited detail about the nature of the investigation, citing statutory provisions.
In response to the Wells Notice, Immutable X stated that it believes the SEC’s claims are targeting the listing and private sales of IMX tokens in 2021. The company referenced a blog post that discussed a pre-launch private purchase of IMX tokens by Huobi Ventures Blockchain Fund. As a result of this news, the price of IMX tokens dropped by over 13% to $1.16 in the past 24 hours.
It is worth noting that several other prominent crypto companies have also received Wells Notices from the SEC in recent years, including Coinbase, Consensys, Ripple, OpenSea, and Crypto.com. The CEO of Immutable X and the Digital Worlds Foundation, the parent organization of the IMX token issuer, also received separate notices from the SEC. Additionally, Immutable X mentioned that it was aware of inquiries from the Department of Justice (DOJ) but had not faced any actual legal action.
Immutable X criticized the SEC for its approach, stating that the lack of direct communication with the company raises doubts about the regulator’s ability to provide clarity to the industry. Despite the SEC’s assertion that tokens are securities, Immutable X remains confident that the IMX token does not fall under this category. The company expressed willingness to defend its position and push back against what it perceives as regulatory overreach.
In conclusion, the crypto industry continues to grapple with regulatory uncertainties, as demonstrated by the SEC’s actions against Immutable X. The outcome of this investigation could have significant implications for how tokens are classified and regulated in the future. Immutable X’s response to the Wells Notice reflects a broader sentiment within the industry regarding the need for clearer regulatory guidelines and a more collaborative approach between regulators and companies.
