- A week after the project’s founder was named in a lawsuit, HEX’s value dropped by 35%.
- As many expect a further decline, token sell-offs have increased.
HEX’s price declined by 35% a week after a lawsuit was filed against the project’s founder Richard Heart by the Securities and Exchange Commission (SEC).
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The regulator claimed that Heart defrauded several investors through the unsanctioned sale of unregistered cryptocurrency assets that were “securities.”
SEC alleged that,
“Each of the Hex, PulseChain, and PulseX offerings involved investments of money in common enterprises with the reasonable expectation of profits to be derived based on the efforts of others. Accordingly, the Hex, PulseChain, and PulseX offerings were securities offerings. At no time did Heart (or anyone else associated with these offerings) register the Hex, PulseChain, or PulseX offerings with the Commission.”
Touted as “the first blockchain Certificate of Deposit (CD),” Heart launched HEX staking in 2019 as an Ethereum-based cryptocurrency project that offers a way for investors to earn interest on their “locked-up” HEX tokens.
According to data from Elastic, since its inception, 60.1 billion tokens have been staked. As of this writing, 49,764 staking positions remained open, with 372,154 positions closed.
Source: Elastic
HEX appears to have been “hexed” by increased sell-offs
At press time, the token exchanged hands at $0.005931. Soon after the lawsuit filing became general knowledge, sellers regained control of the market and have since overpowered the buyers.
A look at the token’s Directional Movement Index (DMI) showed the negative directional index (red) at 32.89, resting solidly above the positive directional index (green) at 18.20. This suggested that selling pressure exceeded buying pressure amongst HEX daily traders.
Suggesting that the current price movement favored the bears, HEX’s Awesome Oscillator was marked with red histogram bars below the zero line.
The Awesome Oscillator is a momentum indicator that compares the closing prices of an asset over a short period to the closing prices over a more extended period. A green crossover across the zero line is a bullish signal, while a red crossover below the zero-line signals bearish sentiments.
Source: HEX/USDT on Trading View
Realistic or not, here’s HEX’s market cap in BTC’s terms
On the chain, HEX’s exchange reserves climbed steadily since the filing was made. In the last week, the token’s supply grew 27%, data from Santiment showed. During the same period, its supply outside of exchanges remained flat as most investors preferred to sell.
Source: Santiment
Further price decline remained on the horizon, with a steady drop in its network activity in the last week. Per information obtained from Santiment, the alt’s count of daily active addresses plummeted by 66% since 31 July. During the same period, the count of new addresses created daily dropped by 68%.
Source: Santiment