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BlockFi, the centralized trading and lending digital asset firm, has received a letter from the New Jersey Bureau of Securities ordering the company to stop accepting new local clients from July 22nd. BlockFiās CEO, Zac Prince, confirmed the development and said they are working with regulators to āhelp them understand our products.ā
- Citing a draft press release from the New Jersey Office of the Attorney General, Forbes initially broke the news about the Bureau of Securitiesā plans to issue a Summary Cease and Desist Order to BlockFi.
- More specifically, the regulator targeted the companyās BlockFi Interest Account (BIA) as it allegedly violated relevant securities laws.
- The crypto company, headquartered in Jersey City, allows customers to lend their digital asset holdings and earn up to 8.5% yearly returns.
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āOur rules are simple: if you sell securities in New Jersey, you need to comply with New Jerseyās securities laws. No one gets a free pass simply because theyāre operating in the fast-evolving cryptocurrency market. Our Bureau of Securities will be monitoring this issue closely as we work to protect investors.ā ā Forbes cited Acting Attorney General Andrew Bruck.
- Zac Prince, the CEO of BlockFi, confirmed receiving such an order from the watchdog. He promised that the firm will remain āfully operationalā for its existing clients based in the Garden State.
- However, the order has requested the company to āstop accepting new BIA clients residing in New Jersey beginning July 22nd, 2021.ā
- Prince outlined that the company has reached out to the regulator āto help them understand our products, which we believe are lawful and appropriate for crypto market participants.ā He added that the BlockFi Interest Account āis not a security, and we, therefore, disagreeā with the watchdogās action.
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