Image source: Zipmex
The Ethereum-based ApeCoin (APE) token took a steep drop when news emerged from the SEC investigating Yuga Labs, the creator of the Bored Ape Yacht Club.
When news of the Securities and Exchange Commission investigation into Yuga Labs surfaced, the token’s price dropped dramatically, dropping nearly 10%.
According to data from CoinGecko, the price fell nearly 11% on Wednesday in the past 24 hours.
At the time, it dropped to $4.67 per token, which was worth $5.27 over the same period.
Since the report came out, APE’s trading volume has nearly doubled over time.
Earlier on Wednesday, Bloomberg released reports that the SEC was investigating Yuga Labs for securities violations with the sale of NFTs from the Bored Ape Yacht Club.
According to the report, which was informed by an unknown source, the agency is also investigating the distribution of ApeCoin.
ApeCoin launched earlier this year in March 2022.
The official position of the creators of Bored Ape Yacht Club is that it is not the creator of ApeCoin due to regulatory issues.
According to the official ApeCoin website, the Ape Foundation is the “steward” of the Ethereum-based token.
The base is designed for use in the growing ecosystem of Bored Ape apps and markets.
The Ape Foundation is anchored by a board made up of leading Web3 builders, including the following:
- Reddit co-founder Alexis Ohanian
- FTX Ventures head Amy Wu
- Animoca Brands co-founder and Executive Chairman Yat Siu
ApeCoin aims to go beyond use in metaverse games and apps.
It is also a governance token that holders can use to vote on proposals involving the EPA protocol.
Holders are considered part of the ApeCoin DAO.
The Decentralized Autonomous Community is an online group brought together by a shared focus, where belonging is represented by the ownership of tokens.
The Bloomberg report states that Yuga Labs has not been charged with wrongdoing and may not be charged as part of the investigation.
Yuga Labs wrote a statement that said:
“It’s well known that policymakers and regulators have sought to learn more about the novel world of Web3.”
“We hoped to partner with the rest of the industry and regulators to define and shape the burgeoning ecosystem,” they continued.
“As a leader in the space, Yuga is committed to fully cooperating with any inquiries along the way.”
ApeCoin sinks 10% after report of SEC probe into Bored Ape Creator Yuga Labs