2024

United

Bitcoin

Trading platform TradeStation Crypto settled with the United States Securities and Exchange Commission (SEC) and a taskforce of state regulators for failing to register an interest-bearing lending product on Feb. 6. The SEC and 26 states will split $3 million in penalties from the case.&nbsp;
Between August 2020 and June 30, 2022, TradeStation Crypto offered “a crypto lending product that allowed U.S. investors to deposit or purchase crypto assets in a TradeStation account in exchange for the company’s promise to pay interest,” the SEC <a href="https://www.sec.gov/news/press-release/2024-16?utm_medium=email&amp;utm_source=govdelivery" target="_blank" rel="noopener noreferrer nofollow">said</a> in a statement. TradeStation had complete discretion over how the assets were used to generate revenue to pay interest to investors, it added.
The SEC issued a consent order finding that the product was an unregistered security. TradeStation Crypto did not admit to or deny the SEC findings.
Simultaneously, the North American Securities Administrators Association (NASAA) announced that TradeStation Crypto had reached a settlement with regulators in 26 states. NASAA president Claire McHenry <a href="https://www.nasaa.org/70993/nasaa-and-sec-announce-3-million-settlement-with-tradestation/?qoid=current-headlines" target="_blank" rel="noopener noreferrer nofollow">said</a>:
<blockquote>
 “This joint investigative effort is typical of how state regulators work every day to protect Main Street investors. This settlement also demonstrates the value of state and federal authorities working together to benefit investors nationwide.”
</blockquote>
Eight states conducted a yearlong investigation of TradeStation Crypto with NASAA coordination. The NASAA, working with the SEC, <a href="https://cointelegraph.com/news/nexo-agrees-to-45m-settlement-with-sec-and-nasaa-over-earn-product" rel="noopener noreferrer nofollow">was also instrumental</a> in the shuttering of Nexo’s interest-bearing product in 2023.
Related: <a href="https://cointelegraph.com/news/securities-regulators-back-sec-in-coinbase-suit" rel="noopener noreferrer nofollow">Securities regulators oppose special treatment of crypto in Coinbase case</a>
TradeStation Crypto has already announced that it would cease offering its services and products in the United States on Feb. 24.
<blockquote class="twitter-tweet">
 The CSI joined a task force of 26 state securities regulators and the U.S. Securities and Exchange Commission (SEC) to announce a $3 million settlement in principle with TradeStation Crypto, Inc. over its unregistered crypto interest earning program. Read the full press release… <a href="https://t.co/LpwfwcSiZc" rel="noopener noreferrer nofollow">pic.twitter.com/LpwfwcSiZc</a>— Commissioner Troy Downing (@DowningCSIMT) <a href="https://twitter.com/DowningCSIMT/status/1755295487694114982?ref_src=twsrc%5Etfw" rel="noopener noreferrer nofollow">February 7, 2024</a>
</blockquote>
Florida-based TradeStation Crypto is a subsidiary of the Japanese brokerage firm, asset manager and cryptocurrency exchange Monex Group. The group invests actively in the crypto sector. It <a href="https://cointelegraph.com/news/monex-wants-to-buy-ftx-japan-amid-bankruptcy-proceedings-report" rel="noopener noreferrer nofollow">expressed interest in buying</a> FTX Japan last year.
The group <a href="https://cointelegraph.com/news/crypto-exchange-coincheck-plans-nasdaq-listing-in-july-2023" rel="noopener noreferrer nofollow">announced plans to list</a> its Japan-based Coincheck cryptocurrency exchange on the U.S. Nasdaq stock exchange in 2022 through a merger with special purpose acquisition company (SPAC) Thunder Bridge Capital Partners IV. The listing was originally planned to take place in July 2023, but later <a href="https://www.sec.gov/Archives/edgar/data/1843993/000121390023044204/ea179521ex99-2_thunder4.htm" target="_blank" rel="noopener noreferrer nofollow">rescheduled</a> for July 2024. Monex Group acquired Coincheck in 2018 after the exchange had been hacked for $534 million.
Monex Group <a href="https://cointelegraph.com/news/monex-group-majority-stake-3iq" rel="noopener noreferrer nofollow">acquired a controlling share</a> in Canadian 3iQ Digital Holdings in December, citing its experience launching Bitcoin (<a href="https://cointelegraph.com/bitcoin-price" rel="noopener noreferrer nofollow">BTC</a>) and Ether (<a href="https://cointelegraph.com/ethereum-price" rel="noopener noreferrer nofollow">ETH</a>) spot exchange-traded funds in Canada.
Magazine: <a href="https://cointelegraph.com/magazine/powers-on-sec-against-crypto-lending/" rel="noopener noreferrer nofollow">Powers On… The SEC takes reactionary moves against crypto lending</a>

TradeStation Crypto settles charges by SEC, 26 states over asset lending

Cointelegraph

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