Crypto lending platform BlockFi has launched its crypto yield product once more after having had to shut it down following an SEC settlement of $100 million. This time, the product is limited to accredited investors.
Crypto lending platform BlockFi has launched its crypto yield accounts once more, it said in a post published on Nov. 7. The company had to remove the yield-bearing account after a $100 million settlement with the United States Securities and Exchange Commission (SEC).
The investment product will be available to certain U.S. BlockFi clients by the end of the year in a beta version. All U.S. clients will receive the opportunity at the beginning of 2023.
There will be 15 assets under this product, with no minimum investment and the ability to trade at the same time. Flori Marquez, the founder and COO of BlockFi addressed the SEC incident, saying,
“As we continue to diligently work towards registration with the SEC for a public offering for BlockFi Yield, we are delighted to share that U.S. clients verified as accredited investors will soon be able to earn interest on digital assets at BlockFi.”
Lending firms have come under the scanner in 2022, with the fall of Celsius and Voyager being two of the most notable developments in the year. BlockFi has survived, but Marquez said that the company was confident in its risk management framework.
$100M fine a warning shot by the SEC
BlockFi was forced to stop offering the product when the SEC charged the company with failing to register it. It settled the matter for $100 million in fines. SEC Chair Gary Gensler said that the case was the first of its kind with respect to crypto lending platforms.
As such, it sent a warning to the rest of the market. The SEC has increased its scrutiny of the market and is keen to ensure that crypto companies meet regulatory standards. The agency is currently conducting multiple other investigations.
BlockFi having a topsy-turvy 2022
BlockFi has experienced a tough year because of the bear market, like many other companies. The company had to lay off 20% of its employees in June, citing macroeconomic conditions as the reason.
The company also had $600 million in loan exposure by the end of the second quarter. FTX, of which Sam Bankman-Fried is the CEO, provided $250 million in credit to the lending firm.
All the information contained on our website is published in good faith and for general information purposes only. Any action the reader takes upon the information found on our website is strictly at their own risk.