The SEC has issued a notice from Wells to blockchain gaming platform Immutable in what has become a widespread crackdown on crypto companies ahead of the US election.
Immutable said in an Oct. 31 blog post that the move is the latest example of the SEC’s “regulation-by-enforcement” policy aimed at the crypto industry. It added that the watchdog had issued the notice without prior discussions
According to Immutable, the SEC’s allegations, while vague, appear to focus on the 2021 listing and private sale of its native token IMX. The network claims that the IMX token does not meet the criteria of a security and that the regulator’s actions circumvent meaningful dialogue.
Immutable said:
“Concocting a case based on a listing that occurred in 2021, without virtually direct communication with the company, is precisely the reason the industry is so skeptical of attempts by this SEC to claim clarity. ”
Immutable’s statement indicated that the SEC’s allegations, while not specific to the Wells notice, appear to focus on potential securities law violations related to the 2021 listing and private sale of its IMX token.
The company expressed frustration that the SEC’s notice contained limited details (less than 20 words of substantive explanation) and lacked a clear basis for the investigation.
Furthermore, Immutable suggested that the SEC’s allegations involved inaccurate claims of “fraudulent misrepresentations” linked to a 2021 blog post about investment prices before the launch of the IMX token.
The company argued that the regulator mischaracterized this information and stated that there was indeed a “real consideration” in the investment, which the agency could have clarified if it had engaged in a constructive dialogue with Immutable before issuing the notice.
Immutable said it is prepared to “defend the rights of builders, creators and gamers,” with its significant war chest and extensive resources. It added that its commitment to the sector is clear and that the sector “will continue to build” regardless of regulatory challenges.