According to a Bloomberg report based on anonymous sources, BlockFi will also discontinue new high-yield accounts for most U.S. residents.
BlockFi spokesperson Madelyn McHugh told Decrypt it would “not comment on market rumors.” However, she added, “We can confirm that clients’ assets are safeguarded on the BlockFi platform and BlockFi Interest Account clients will continue to earn crypto interest as they always have.” If so, that means existing account holders might be grandfathered in.
BlockFi’s business model is offering customers high interest rates for locking up cryptocurrencies such as SEC alleged in November that these BlockFi Interest Accounts, which can deliver yields in the range of 5 to 10%, are unregistered securities., and into savings accounts. The company then loans those funds out at even higher rates. But the
The SEC attention came after a quintet of state securities regulators—from Alabama, Kentucky, New Jersey, Texas and Vermont—issued show-cause or cease-and-desist orders demanding that BlockFi cease offering products to their residents.
Mark Cuban’s Dallas Mavericks had a middling offense last season. That doesn’t mean he’s a believer in standing pat and playing defense. The billionaire entrepreneur and crypto investor today
Other crypto lenders are also facing scrutiny from state and federal regulators, among them BlockFi competitor Celsius. Coinbase in September shuttered its planned high-yield Lend product after the SEC threatened to sue.
Under Fire From SEC, Crypto Companies Choose to Die Hard
When Coinbase CEO Brian Armstrong tweeted on Tuesday night that the SEC threatened to sue if the company launches its high-yield Lend product, Ripple CEO Brad Garlinghouse was swift to respon…
The $100 million settlement, if accurate, would be one of the largest-ever cryptocurrency enforcement actions.
In 2019, the SEC fined Block.one $24 million for its role in staging the EOS initial coin offering, a relative pittance compared to the $4.2 billion raised. In 2020, messaging app Telegram paid an $18.5 million fine and refunded investors $1.2 billion over its aborted TON token launch.
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