Immutable says it received a Wells notice from the US SEC over securities law violations potentially involving IMX

Blockchain gaming platform Immutable says the U.S. Securities and Exchange Commission has signaled that it may bring an enforcement action against it over allegedly breaking securities laws.

The company said that the SEC sent a Wells notice shortly after first meeting with the agency. A Wells notice is a form of communication from SEC staff that lets a firm know that the agency's staff may recommend an enforcement action against them. 

"Prior to the issuance of a Wells notice, there are often multiple months of interviews and conversations between company counsel and the SEC, so the SEC can fully understand the situation," Immutable said in a post on Thursday. "Instead, in our very first interaction with the SEC, we were told a Wells notice would be issued to the company within the week. We then received it within hours." 

Immutable said it believes the SEC's claims could involve the listing and private sales in 2021 of IMX, but said the notice included sparse details. The company also said it was "aware of related inquiries, but no actual or proposed legal action, from the [Department of Justice]."

"The SEC does not comment on the existence or nonexistence of a possible investigation," an agency spokesperson told The Block.

Multiple crypto firms have received Wells notices over the past year, including Robinhood Crypto, Crypto.com and OpenSea. The SEC has also brought a number of enforcement actions against big firms over the years, including Coinbase, Kraken and others. SEC Chair Gary Gensler has said that crypto firms needs to register with the agency, follow its rules and said that investor protections are vital.

Some in the crypto industry have fought back, saying that it's not possible to register with the agency, in part because rules were made for more traditional entities that are different from the digital asset industry. 

Immutable asserted that IMX is not a security and said if needed, it will argue its case.

"We are confident in our position, 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," the firm said in an X post. "If required, we will fight for these rights, and those of our industry, vigorously."