Blockfi faces sec scrutiny over highyield

#Blockfi faces sec scrutiny over highyield cracked#
#Blockfi faces sec scrutiny over highyield series#

In September, the SEC embarked on a move that seems to shake the whole crypto lending industry. Other states such as Kentucky and Vermont also raised similar concerns regarding BlockFi products over the previous several months.

#Blockfi faces sec scrutiny over highyield cracked#

Several US states have cracked down on the crypto lending platform for potentially violating securities laws with its high-end accounts.ДЄs reported by Blockchain.News, US states of Texas, Alabama, and New Jersey in July announced that the platform did not register its BlockFi Interest Accounts (BIAs) with state regulators and that they may be unregistered securities offerings. The latest development is not the first time when BlockFi clashed with authorities. The firm has been backed by investors like Tiger Global Management and Bain Capital since its establishment in 2017. So far, the SEC has not accused BlockFi of any wrongdoing, but BlockFi has maintained that its product is not a security.Д«lockFi currently has more than 500,000 retail accounts and its value currently stands at over $4 billion. If so, these products must then be registered with the agency. Sources who requested their identities to remain anonymous told Bloomberg media outlets that the SECвЂ™s probe is majorly focused on the need to determine whether such interest-earning accounts called вЂњBlockFi interest accounts (BIAs) are securities. While digital-asset savings accounts offer higher interest rates, they are not insured by the federal government, unlike bank deposits. In contrast, traditional savings accounts allow holders to earn a mere 0.06% annually. The rate of return on the dollar-pegged cryptocurrencies is significantly much higher than those of banks.ДЄccording to its website, BlockFi provides accounts that allow users to earn annual yields as high as 9.5%. The firm lets users lend and borrow a wide range of cryptocurrencies such as bitcoin, ethereum as well as stable coins like tether and USD Coin.

#Blockfi faces sec scrutiny over highyield series#

Earlier this year, a series of state-level agencies had launched investigations into BlockFi.Д«lockFi, a New Jersey-based company has grown in popularity with such product offerings. The US Securities and Exchange Commission is probing BlockFi cryptocurrency lending platform over itsВ high-yield, interest-bearing accounts.