Image source: Zipmex
The Ethereum-based ApeCoin (APE) token took a sharp fall when reports emerged of the SEC investigating Bored Ape Yacht Club creator Yuga Labs.
When news of the Securities and Exchange Commission’s investigation of Yuga Labs surfaced, the token’s price took a sharp fall, dropping nearly 10%.
According to data from CoinGecko, the price dropped to nearly 11% in the past 24 hours early Wednesday.
At the time, it dropped to $4.67 per token, which was worth $5.27 during the same span.
Since the report came out, APE trading volume over the span nearly doubled.
On early Wednesday, Bloomberg released reports that the SEC was probing Yuga Labs over securities violations with the sale of Bored Ape Yacht Club NFTs.
According to the report, which was tipped by an unnamed source, the agency is also investigating the distribution of ApeCoin.
ApeCoin was launched earlier this year in March 2022.
The Bored Ape Yacht Club creators’ official stance is that it isn’t the creator of ApeCoin due to regulatory concerns.
According to the official ApeCoin website, the Ape Foundation is the “steward” of the Ethereum-based token.
The foundation is designed for use throughout the growing Bored Ape ecosystem of apps and marketplaces.
The Ape Foundation is anchored by a board consisting of prominent 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 is meant to expand beyond use across metaverse games and apps.
It is also a governance token that holders can use to vote on proposals that impact the APE protocol.
Holders are considered part of the ApeCoin DAO.
The decentralized autonomous community is an online group brought together by a shared focus, with membership represented through token ownership.
The Bloomberg report said that Yuga Labs hasn’t been accused of wrongdoing and might not be charged as part of the probe.
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