BlockFi, Accused of 'Securities Law Violations,' Agrees to Pay $120 Million Fine to US SEC

[Asia Economy Reporter Jeong Hyunjin] Cryptocurrency company BlockFi has agreed to pay a total fine of $100 million (approximately 120 billion KRW) to the U.S. Securities and Exchange Commission (SEC) and 32 U.S. states. The charge is that BlockFi's interest-bearing cryptocurrency savings products violated regulations by not registering with financial authorities.

According to the Wall Street Journal (WSJ) and others on the 14th (local time), the SEC announced that it reached this agreement with BlockFi regarding allegations that BlockFi's investment products violated the Investor Protection Act.

BlockFi has been selling products that pay interest when users subscribe to services allowing them to lend their held cryptocurrencies to other users. BlockFi advertised on its website that the annual interest rate reaches up to 9.25%, significantly exceeding the average interest rates of financial institutions' savings products.

The SEC claimed that BlockFi violated the investment product registration law by not registering its individual cryptocurrency products. BlockFi neither admitted nor denied the allegations but agreed to pay $50 million to the SEC and $50 million to 32 states in fines.

Gary Gensler, SEC Chairman, said, "This case is the first involving a cryptocurrency lending platform," adding, "Today's agreement clarifies that the cryptocurrency market must comply with securities laws that have been proven effective over a long period."

BlockFi plans to stop offering accounts within the United States and seek ways to register new products in accordance with SEC regulations.

This content was produced with the assistance of AI translation services.