The United States Securities and Exchange Commission (SEC) has accused Nexo of failing to register one of its products with its services. As a result, the cryptocurrency lending company agreed to pay $45 million from various regulators, including the SEC.
Nexo disburses 45 million dollars to the American financial policeman
The Securities and Exchange Commission (SEC) seems to have taken a very close interest in crypto companies since the beginning of 2023. After placing Digital Currency Group (DCG) under investigation, then Genesis as well as Gemini, the financial policeman declared, via a press release, that Nexo violated investor protection laws.
The SEC refers to the “Earn Interest Product” (EIP) offered by Nexo, a tool that allows investors to deposit their cryptocurrencies on the platform in exchange for attractive interest. According to the document, the EIP has the status of a security in the United States, and must therefore be filed with the SEC. A rule that would not have been respected by the cryptocurrency lender.
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Thereby, Nexo has agreed to pay a financial penalty amounting to $22.5 million with the SEC and to end its “Earn Interest Product” offer on American soil. In parallel, the cryptocurrency lender paid the exact same sum to other regulators for the same reasons.
An initiative that aims, according to the chairman of the SEC Gary Genslerto protect investors:
“Compliance with our time-tested public policies is not an option. When cryptocurrency companies fail to comply, we will continue to follow the facts and the law to hold them accountable. In this case, among other actions, Nexo is ending its unregistered lending product to all US investors. »
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Nexo faces some international setbacks
Nexo, who has neither denied nor admitted the facts with which he is charged here, could well pay this fine in order to leave the United States in peace. Indeed, at the beginning of last December, the cryptocurrency lender announced that it was ending its activities on American soil due to a ” lack of regulatory clarity ».
The company then claimed to have made numerous efforts to maintain its services in the best conditions, in particular by having held numerous and long discussions with the local authorities.
Beyond the United States, Nexo had its offices recently visited by Bulgarian police in Sofia on suspicion of money laundering and other tax crimes. A large-scale operation, which mobilized no less than 300 police officers. On his side, the company has denied these accusations and continues to make every effort to cooperate with the authorities where it is located.
Finally, in a document filed on January 12, Nexo has filed a lawsuit against the Cayman Islands Monetary Authority (CIMA), because the latter refused its application for registration allowing it to access the status of virtual asset service provider.
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Source: SEC press release
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Passionate about the world of decentralized finance and the novelties brought by Web 3.0, I write articles for Cryptoast to help make blockchain more accessible to everyone. Convinced that cryptocurrencies will change the future very soon.
Maximilien Prue
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