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SEC is Investigating BlockFi Regarding the Crypto Exchange’s High-Yield Accounts -Breaking

by Mike Robinson

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SEC is Investigating BlockFi Regarding the Crypto Exchange’s High-Yield Accounts

The U.S. Securities and Exchange Commission (SEC) has focused its sights on another blockchain-based company – this time it’s BlockFi. The SEC seems to be concerned with BlockFi’s high interest rates for lending out staked digital tokens from clients who opt-in for that very purpose.

BlockFi accounts are being questioned by the SEC as securities. To be eligible for operation, you must register with the agency. On its website, BlockFi boasts an annual percentage yield of 9.5 percent. This is significantly higher than traditional savings accounts which offer lower than 0.5 percent. BlockFi’s subpar customer protections as well as questionable marketing tactics have been brought to the attention of New Jersey, Texas, and New Jersey.

What’s ironic is that most crypto lenders and decentralized finance companies – as well as BlockFi — are able to provide retail investors such outstanding returns, because they charge institutional investors much higher fees to access crypto markets. The sky-high fees paid by big banking and financial fiefdoms actually trickle down to individual investors – benefiting the little guy for once. These facts should not be a hindrance to a thorough investigation by the SEC.

BlockFi was privately owned and valued at $4 billion. The company has over half a million retail accounts. It’s important to note that the SEC hasn’t accused BlockFi of any wrongdoing or criminal activity, and not all agency investigations lead to enforcement actions.

Flipside

  • SEC has been building a reputation as a Grade-A bully.
  • In the last year, the SEC went after Coinbase (NASDAQ :), Binance, BlockFi, and Coinbase.
  • What point is regulatory oversight considered abuse of power?

What are the reasons to care?

The SEC must stop its ongoing attack on crypto. The SEC appears to constantly be exceeding its legal boundaries in harassing and coercing crypto/blockchain organisations beyond what is allowed by Congress.

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