The SEC or Securities Exchange Commission, which plays the role of financial policeman in the United States, has just cracked down again. She accuses the cryptocurrency lending company Nexo of violating the Securities Act relating to the protection of investors. Its EIP, or Earn Interest Product, service allegedly breached property values rules. She was then ordered to pay a fine of 45 million dollars (just over 41 million euros).
The company must return half of this amount to the SEC, while the rest of the amount will be allocated to other regulators. In addition, Nexo is required to complete its EIP offering on US soil. What has already been done, even before the charges have been launched against him. Unfortunately for them, users continued to use this tool, automatically renewing previously created accounts.
Explanations from the SEC
According to its president, Gary Gensler, We accused Nexo of failing to register its retail crypto-lending product before offering it to the public, circumventing essential disclosure requirements designed to protect investors “. He even added ” Compliance with our documented public policies is not a choice. When crypto companies fail to comply, we will continue to follow the facts and the law to hold them accountable. »
It is clear that for this institution the purpose of this type of initiative is to protect investors. Since the EIP enjoys property value status in the US, Nexo would have failed to declare it to the SEC.
Nexo’s reaction
Antoni Trenchev, co-founder of Nexo, said in a statement: We are pleased with this joint resolution, which puts an unequivocal end to all speculation surrounding Nexo’s relationship with the United States. “. He also states ” We can now focus on what we do best: creating transparent financial solutions for our global audience. They will therefore continue to develop and improve, taking into account the comments they have received.
Nexo agreed to pay that fine, but they neither admitted wrongdoing nor denied the findings of the SEC’s investigation. At least it saves them from an expensive lawsuit.
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