US securities watchdog flags legal action against blockchain Immutable
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The news: Australian gaming and blockchain technology company Immutable has received a Wells notice from the US Securities and Exchange Commission (SEC), indicating possible legal action over alleged securities law violations and misrepresentations.
The numbers: The allegations relate to a 2021 blog post regarding a pre-launch investment made in the IMX token at a price of $0.10 ($10 pre 100:1 split).
The context: Immutable said the SEC allege the price was inaccurate and implied there was no exchange of value between the parties. Immutable said this allegation "is incorrect".
The company claims the notice was issued within hours of their first interaction with the SEC, with limited explanation.
The Wells notice comes amid increased SEC regulatory actions against cryptocurrency and Web3 companies. Immutable joins other major industry players like Coinbase, Consensys, Ripple, OpenSea, and Crypto.com who have faced similar notices.
Immutable, founded in 2018, maintains it has spent millions of dollars on governance and legal compliance. The company operates in the gaming industry, which spends more than $168 billion annually on in-game items.
What they said: "We are confident in the legality of our assets and services, in the value digital ownership can bring to 3.1 billion gamers across the world, and in the power of blockchain to create a better internet," Immutable stated in its response on its blog.
On X it said: “Immutable is well capitalized with a large war-chest to build for the future of gaming, and if needed, we will stand up and fight to defend digital ownership for gamers. But the SEC’s approach hinders every startup trying to innovate in an already difficult industry”.
The sources: Immutable blog , Immutable X
