HEX capitalization sank by $500 million amid SEC lawsuit
Date: 2023-08-06 Author: Karina Ziganova Categories: BLOCKCHAIN, IN WORLD
Decentralized exchange (DEX) Uniswap has flagged HEX as an unreliable asset, and the MetaMask crypto wallet has dropped support for the troubled token.
The market capitalization of the HEX token fell by almost $500 million after the US Securities and Exchange Commission (SEC) recognized it as a security in its lawsuit against project founder Richard Hart.
On July 31, the SEC charged Hart with violating securities laws. In the lawsuit, the regulator called all of Hart's crypto projects, including HEX, PulseChain and PulseX, fraudulent.
The commission also alleges that the unfortunate crypto mogul used investors' funds to buy luxury items.
After the filing of the lawsuit, the capitalization of HEX fell from $1.47 billion to $706 million. However, after the price of the token rose by more than 20% over the past two days, the indicator returned to the $1 billion mark.
Pulsechain TVL drops while trading volume rises
The lawsuit also affected the total value of assets locked in the first layer (L1) network of Pulsechain. It has fallen more than 50%, from $327 million as of July 31 to $136 million on August 2, according to DeFillama. At the time of writing, TVL has recovered to $206.43 million.
In addition, trading volume on decentralized exchanges on the Pulsechain network has increased by more than 300% since the filing of the SEC lawsuit to nearly $300 million.
Crypto platforms break ties with HEX
After the SEC lawsuit, the MetaMask cryptocurrency wallet ended support for HEX, and Uniswap, the largest decentralized exchange, marked the token as unreliable. Market participants suggested that the actions of both platforms were caused by a desire to protect themselves from possible claims from the regulator.
However, this decision drew sharp criticism from the HEX community and crypto enthusiasts, who questioned how “decentralized” these sites are.
