New York, Sunday, November 03, 2024-The US Securities and Exchange Commission (SEC) has issued a Wells Notice to Ethereum-based gaming company Immutable, suggesting it may face legal action for alleged securities law violations connected to its IMX token sales.
The SEC’s notice also included a letter to Immutable’s CEO, James Ferguson, and the Digital Worlds Foundation, which helped issue the IMX token, warning of potential enforcement.
Immutable asserts that the SEC’s allegations relate to its 2021 IMX sales, where the company raised $12.5 million on the CoinList platform shortly after the token launch. Immutable contests the SEC’s claims, maintaining that IMX is not a security, and criticized the notice for a lack of specific details.
A spokesperson for Immutable stated that “the SEC’s overreach has expanded into gaming,” marking the regulator’s first public targeting of a crypto gaming company.
The SEC also alleges that Immutable misled the public about an unconfirmed “pre-launch investment” from Huobi Ventures, which the company had initially announced in 2021. Immutable, however, insists it has been transparent in its operations and that it has ample financial resources to defend against regulatory challenges.
The IMX token, launched as an ERC-20 token on Ethereum, holds the top spot in gaming tokens by market cap, valued at $2.1 billion.
