Crypto lending company Nexo has agreed to pay a total of $45 million to US regulators to settle claims that it failed to register sales of its earned interest product (EIP).
according to two separate Statement By the US Securities and Exchange Commission and the North American Securities Administrators Association, Nexo has agreed to pay a fine of $22.5 million to each of these regulators or a total of $45 million to settle allegations that it violated investor-protection policies. laws have been violated.
The SEC said the crypto lender has also agreed to cease its offering and sale of EIPs to US investors.
Nexo started offering its product of interest to US customers in June 2020. The product allowed users to tender their crypto assets in exchange for industry-high interest rates. The SEC claims that the product is a security and therefore Nexo needs to be registered with the agency.
“We are not concerned with the labels placed on products, but with their economic realities,” said Gurbir Grewal, director of the SEC’s Enforcement Division. And part of that reality is that crypto assets are not exempt from federal securities laws. ” ,
“If you are offering or selling products that constitute securities under well-established laws and legal precedent, then no matter what you call those products, you are subject to those laws. And we expect compliance.”
Launched in 2018, Nexo is a British digital asset lending company that lends client funds and uses the proceeds to pay interest. In September 2022, the company came face-to-face with US authorities for the first time after several states, including California, Vermont, Oklahoma, South Carolina, Kentucky and Maryland, filed cease-and-desist orders against the company.
In a press release, Nexo Told Settlement is on no-accept-no-refuse basis. In other words, the company neither admitted nor denied any wrongdoing. Nexo co-founder Antoine Trenchev said:
“We are satisfied with this unified resolution that clearly ends all speculation regarding Nexo’s ties to the United States. We can now focus on what we do best – our worldwide Build seamless financial solutions for audiences.
As mentioned, the Bulgarian office of Nexo raided by local police last week, with officers investigating suspected money laundering, tax crimes, computer fraud and other violations. Next, the crypto lender looked into wave of withdrawal,
It is worth noting that Nexo is one of the many crypto lending companies that has not gone out of business. Other major crypto lenders, including Celsius, BlockFi, and most recently the crypto lending unit of Genesis, have filed for bankruptcy amid the recent market downturn.
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