BlockFi is currently collecting massive investments – but now the securities authorities of three US states are blowing an attack on the crypto lending platform.
After Coinbase, the first Bitcoin exchange went to Wall Street in April, BlockFi, the first crypto lending provider, could soon celebrate its premiere on the trading floor. That reported the crypto portal Coindesk citing a document that BlockFi is said to have sent to its investors. Accordingly, the company plans to dare to go public within the next 12 to 18 months. Another financing round is currently underway for BlockFi, which, according to insider information, will bring an additional 500 million into the company and should be completed on July 27th. The document mentions a post-money valuation of a whopping $ 4.75 billion. As recently as March, BlockFi announced the successful completion of a $ 350 million USD Series D financing round.
BlockFi targeted by US regulators
BlockFi offers, among other things, interest for lending Bitcoin and Co. Depending on the amount and duration of the deposited amount, Hodlers can let their digital gold “work for them” and earn a fixed annual interest rate.
There is only one catch: Recently, more US regulators have been rubbing against the offer, which is being marketed as the “BlockFi Interest Account (BIA). The suspicion: the BIA fulfills the conditions of an advertising contract and would therefore be a security subject to registration. The stock exchange regulators of three US states are currently targeting BlockFi.
On July 20, BlockFi received an injunction from the New Jersey Securities and Exchange Commission. Since then, the crypto lending platform has been banned from offering a BIA to citizens of New Jersey.
Our rules are simple: If you are selling New Jersey securities, you must comply with New Jersey securities laws. Nobody gets a carte blanche just because they are in the rapidly evolving crypto market. Our Bureau of Securities will be closely monitoring this issue as we work to protect investors,
justified the interim attorney general of New Jersey the order in a press release.
The south makes people mobile
A day later, the state of Alabama took on BlockFi in the form of the Alabama Securities Commission (ASC).
There are thousands of companies registered with the ASC as required by law to sell securities to the citizens of Alabama. Most of those registered for securities sales reside outside of Alabama, but anyone offering securities must be registered before making an investment offer to an Alabama resident.
it says in an ASCMessage (US proxy required to access) July 21st.
The potential mining mecca of Texas has recently joined the criticism. In a now deleted, but about that Web archive The stock exchange supervisory authority BlockFi also subordinates trading in unregistered securities to this document, which can still be accessed. A hearing on October 13th should clarify whether an injunction should be brought against BlockFi.
BlockFi now has an update on the regulatory quarrels released. It states that all existing customers can still use the service without restrictions. As far as the controversial BIA is concerned, the company is convinced that it is not a security. At the same time, BlockFi signaled its willingness to enter into a dialogue with the regulatory authorities and promised further updates on the BIA cause.