Cryptocurrencies

BlockFi to Pay $100 Million to SEC, States on Crypto Lending

SEC says BlockFi plans to register new lending product
Company to pay $50 million to SEC, $50 million to 32 states

WATCH: BlockFi’s Zac Prince discusses the crypto platform’s agreement to pay $100 million to the SEC and state regulators over allegations it illegally offered a product that pays customers high interest rates to lend out their digital tokens.Source: Bloomberg

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By Matt Robinson and Joe Light

February 14, 2022 at 4:00 PM UTC

Updated on

February 14, 2022 at 6:10 PM UTC

This article is for subscribers only.

BlockFi Inc., a popular crypto platform, agreed to pay $100 million to the Securities and Exchange Commission and state regulators over allegations it illegally offered a product that pays customers high interest rates to lend out their digital tokens.

The company sold the accounts to U.S. investors without registering them with the SEC as securities, the agency said in a Monday statement. As part of the agreement, current BlockFi customers can continue to earn interest on their existing investments, but the company must not sell the products to new American clients. The company has 60 days to seek to comply with SEC regulations and it’s also seeking to register a new crypto-lending product that will satisfy the agency’s rules.