Saturday, May 11, 2024

BlockFi Enters Landmark Resolution with Federal and State Regulators Providing Clarity

BlockFi Lending, a subsidiary of BlockFi Inc., has entered into a resolution with both the U.S. Securities and Exchange Commission (SEC) and the North American Securities Administrators Association (NASAA) providing regulatory clarity and a path forward for clients across the United States who want to earn interest on their crypto assets. As part of this resolution, BlockFi intends to file or confidentially submit a registration statement on Form S-1 with the SEC for the offering of BlockFi Yield (BY), which is anticipated to be the first SEC registered crypto interest-bearing security.

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Zac Prince, CEO and Founder of BlockFi, said: “From the day we started BlockFi, we have always known that strong engagement with regulators would be critical for the adoption of financial services powered by cryptocurrencies. Today’s milestone is yet another example of our pioneering efforts in securing regulatory clarity for the broader industry and our clients, just as we did for our first product – the crypto-backed loan. We intend for BlockFi Yield to be a new, SEC-registered crypto interest-bearing security, which will allow clients to earn interest on their crypto assets.”

BlockFicooperated with the government’s investigation and implemented remediation actions. Both the SEC and state-level agreements contain no admission or denial of wrongdoing or liability.

As part of the resolution, existing U.S. BlockFi Interest Account (BIA) clients will maintain their accounts and receive interest as they always have, but cannot add new assets to their accounts as of today, February 14, 2022. Further, U.S. persons will not be able to open new BIAs. Following completion of the SEC registration process for BlockFi Yield, BIAs of U.S. clients will be exchanged for BlockFiYield, unless a client instructs BlockFi otherwise. BIAs of BlockFiclients outside of the U.S. are not subject to today’s resolution.

BlockFi’s broad suite of retail and institutional products for existing and new clients continues to be offered worldwide, including: (i) buying and selling leading digital assets directly on BlockFiTrading; (ii) earning crypto rewards on the BlockFiRewards Credit Card; (iii) accessing personalized crypto interest rates, trading costs and other terms to meet the individual objectives of high net worth individuals via BlockFiPersonalized Yield; and (iv) originating US dollar loans secured by the value of digital assets on the platform through BlockFi Loans. Additionally, It is a leading lender and provider of trade execution services globally to institutions participating in digital asset markets through the BlockFiPrime platform.

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