Nexo Fined $45 Million for Failing to Record Bitcoin Loans

Of the United States Securities Exchange Commission (SEC) authorized the issuance of crypto loans Nexo for failure to register the offering and sale of its asset lending products. In particular, Main Nexus has been fined US$45 million for the illegal offer and sale of unregistered securities in connection with its leveraged loan scheme, Profitable Interest (EIP).

As part of the settlement, Nexo has agreed to pay $22.5 million up front to stop its offer to register and sell EIP to U.S. investors, according to an SEC filing. . In addition, the company will pay another $22.5 million to settle similar charges by state regulators, which is in addition to $45 million in fines.

The company offered its loan products since June 2020, where American investors could offer their cryptocurrencies to Nexo in exchange for the promise of interest payments.

Nexo has been under the watchful eye of regulators in recent times—not only in the United States but abroad. Recently, it was reported Nexo has been under investigation for allegations of money laundering and violation of Russian sanctions on Bulgaria, although said the public prosecutor “There is no political focus on the research communicationwork.”

Although a fine is more than a slap on the wrist, it could be worse. As reported by CoingeekNexo appears to have saved itself from more severe penalties by voluntarily withdrawing the product from the US market after it was completed. BlockFi was forced to pay $100 million penalty for the same in February 2022.

We accused Nexo of failing to register its crypto lending products before offering them to the public, not requiring important information designed to protect investors.

Chairman of the Securities and Exchange Commission, Gary Gensler

For its part, Nexo provided a information which ensures that the sentence against the company “closes all the investigations of many years on Nexo, classifying different parts of the business, after the offer decision of the company to stop offering its products to America.”

In addition, the company expressed its intention to leave the United States market and pay fines within 12 months.

The crackdown on Nexo is the latest attempt to give regulatory authority to the post-crisis crypto space. fall of FTX in November. It will come just a few days later The SEC sued two major companies – Gemini Trust and Genesis Global Capital – with the sale of unregistered products to individual investors is a strong warning in crypto trading, people Lenders and other institutions are required to comply with US securities laws.

TDR expects some of the most advanced crypto and philanthropic events in the first quarter of the 2023 calendar year.

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