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Blockfi agrees to pay $100M in penalties and pursue registration

sec.gov

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Re: Blockfi agrees to pay $100M in penalties and pursue registration

#11

Post by capableweb »

pm90 wrote: post #5
capableweb wrote: post #3

Interesting to read BlockFi's own statement about the event: https://blockfi.com/regulatory-developments/ No mention of the fine at all, and instead framed as "first SEC registered crypto interest-bearing security" (from BlockFi's page) rather than "[BlockFi] failing to register the offers and sales of its retail crypto lending product" and "the SEC also charged BlockFi with violating the registration provisions of t…

They won’t. The desire for making a quick buck is too strong. The avalanche of marketing around crypto is going to lead many gullible people to “invest” in crypto and lose their money. Unless regulators shut them down or expose them quite clearly as mlm/ frauds I suspect this isn’t going to stop.

> Unless regulators shut them down or expose them quite clearly as mlm/ frauds I suspect this isn’t going to stop.

It seems, based on this action that the SEC just went through with, that things like BlockFi are not "clearly MLM / fraud" as you say, as otherwise they would indeed try to get them shutdown, not just slap a tiny fine on them.

Re: Blockfi agrees to pay $100M in penalties and pursue registration

#12

Post by ivalm »

vinniejames wrote: post #6
capableweb wrote: post #3

Interesting to read BlockFi's own statement about the event: https://blockfi.com/regulatory-developments/ No mention of the fine at all, and instead framed as "first SEC registered crypto interest-bearing security" (from BlockFi's page) rather than "[BlockFi] failing to register the offers and sales of its retail crypto lending product" and "the SEC also charged BlockFi with violating the registration provisions of t…

Quoted post unavailable.

Did they offer an unregulated security where there is a chance to lose principle to unsophisticated retail investor which is well known to be illegal? The answer to that is yes.

Re: Blockfi agrees to pay $100M in penalties and pursue registration

#14

Post by rabite »

coconut08 wrote: post #7

Is there something about Gemini's version of the interest bearing account that makes it less problematic than Blockfi's offering? Why is it that Blockfi has taken so much heat and Gemini has seemed to fly completely under the radar? Does this suggest that the issue was the marketing and the implementation that was the issue rather than the product itself?

Blockfi was the easiest case to make in the room, but Gemini and Celsius are now being investigated by the SEC as of last month.

https://www.bloomberg.com/news/articles/2022-01-26/crypto-le...

Re: Blockfi agrees to pay $100M in penalties and pursue registration

#15

Post by cypherpunks01 »

pazimzadeh wrote: post #8
coconut08 wrote: post #7

Is there something about Gemini's version of the interest bearing account that makes it less problematic than Blockfi's offering? Why is it that Blockfi has taken so much heat and Gemini has seemed to fly completely under the radar? Does this suggest that the issue was the marketing and the implementation that was the issue rather than the product itself?

Same question, with Celsius.

Coindesk writes, "The SEC is reportedly investigating Voyager Digital, Gemini Trust and fellow crypto lender Celsius Network." There is no difference.

Re: Blockfi agrees to pay $100M in penalties and pursue registration

#17

Post by capableweb »

coconut08 wrote: post #7

Is there something about Gemini's version of the interest bearing account that makes it less problematic than Blockfi's offering? Why is it that Blockfi has taken so much heat and Gemini has seemed to fly completely under the radar? Does this suggest that the issue was the marketing and the implementation that was the issue rather than the product itself?

I guess it could have something to do with that Gemini is a registered exchange and regulated by the NYDFS, while BlockFi goes the more traditional cryptocurrency exchange route of "Let's see what turns out to be illegal when we get there".

Re: Blockfi agrees to pay $100M in penalties and pursue registration

#18

Post by 300bps »

coconut08 wrote: post #7

Is there something about Gemini's version of the interest bearing account that makes it less problematic than Blockfi's offering? Why is it that Blockfi has taken so much heat and Gemini has seemed to fly completely under the radar? Does this suggest that the issue was the marketing and the implementation that was the issue rather than the product itself?

Read Blockfi's press release:

https://blockfi.com/regulatory-developments/

BlockFi is first participant in new regulatory framework for crypto sector

They're the first participant. They won't be the last. Police can't pull over every car at the same time and neither can the SEC go after every actor simultaneously. What the SEC has now though is a precedent of cooperation.

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