Vermont Regulator Requests BlockFi To Stop Placing Unregistered Securities – Bits Media

Vermont became the fourth state, ordering the termination of BlockFi's interest-bearing savings accounts.

Vermont Regulators Join New Jersey Requirements, Alabama and Texas. Last week The regulators of these states began investigations against Blockfi and its two subsidiaries: BlockFi Lending и BlockFi Trading.

Financial regulators claim, that Blockfi interest accounts, who advertise high profitability for customers, Depositing cryptocurrencies, equivalent to unregistered securities. Securities include investment contracts. Their sale in the United States should be registered by the Securities and Exchange Commission (SEC).

Blockfi denies the claims and argues its position of topics, that cryptocurrency is not recognized as a legal payment tool, Not supported by the government, And the Blockfi interest account is not a banking or brokerage account.

Blockfi account is not subject to insurance in FDIC, Protection of securities investors in SIPC or other similar protection measures. Interest rates, Limits for withdrawing funds and commission can be changed and are largely dictated by market conditions. This is not a risk -free product and the loss of the main invested amount is possible.

Chronology of events

It all started last Monday, When the general prosecutor of New Jersey ordered Blockfi to stop attracting new customers. The order did not prevent Blockfi from serving existing customers in the state.

On Wednesday, the regulatory bodies of Alabams warned Blockfi on the preparation of an order to terminate illegal actions. The company has 25 days, to bring convincing arguments in their favor.

And on Thursday 22 July Council for Securities Texas (Tssb) presented the company order to terminate activities, which can enter into force after listening 13 October.

In this way, Vermont became the fourth state, issued an order to restrict the Blockfi activities under the article on the placement of unregistered securities.