BlockFi, a crypto lending platform, has re-introduced its crypto yield service into the market. This comes after the platform paid a $100M fine for breaking SEC’s securities laws. However, BlockFi has emphasized that only accredited investors can use the product now.
Recently, BlockFi published a post stating that it has brought back its crypto yield product. However, the lender paused its yield-bearing account after receiving a fine of $100M from the US SEC (Securities and Exchange Commission).
However, BlockFi stated that the yield-bearing accounts would only be available for some US clients. It plans to open the product to all users in 2023.
According to the report, the yield product will have 15 digital assets under it. Also, there would be no minimum investment for the assets. This means users can invest whatever they have.
BlockFi’s COO and founder, Flori Marquez, commented on the recent statement. The founder stated that:
“We are working with the US SEC to register our BlockFi Yield. However, we are excited to tell accredited investors that they will soon start earning interest on crypto at BlockFi.”
Meanwhile, crypto lending platforms have been under intense regulatory scrutiny in 2022. This came after several crypto lenders went bankrupt due to the bearish crypto market.
Also read:Lending platforms like Voyager and Celsius had to file for bankruptcy. Also, most lending platforms stopped withdrawals and deposits. This stopped users from withdrawing their crypto holdings.
Fortunately, BlockFi did not go bankrupt. Marquez noted that the firm had a strong risk management framework.
BlockFi Laid Off 20% Of Workers Amid Crypto Winter
BlockFi stopped offering its crypto yield product after a notice from the US SEC. The regulator alleged that the lender broke its securities laws.
In February, BlockFi agreed to pay the sum of $100M as a fine. $50 million went directly to the regulator, while the other $50 million went to 32 US states. Gary Gensler, the Chairman of the SEC, stated that this was its first securities case with a crypto lending platform.
As a result, this was a significant warning to other crypto lending platforms in the market. Additionally, the US SEC has tightened its scrutiny on the crypto sector.
Reports reveal that the agency is currently investigating various crypto entities. The aim is to ascertain if they have broken its securities law presently or in the past.
Meanwhile, BlockFi, like most firms, has had a bad year given the crypto market crisis. In June, the crypto lender laid off over 20% of its workers, citing macroeconomic conditions.
In addition, the firm reported that its loan exposure at the end of Q2 2022 was over $600 million. As a result, the firm had to obtain credit from Sam Bankman-Fried’s crypto firm, FTX.
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