New York’s AG Stays Busy, Two Crypto Platforms Shutdown Others Under Investigation

Submitted by Anonymous (not verified) on Mon, 10/18/2021 - 19:50

Per a press release, the office of the New York Attorney General Letitia James revealed actions against two crypto platforms. The companies have been ordered to stop their operations to “protect New York investors from exploitation by high-risk virtual currency schemes”.

The AG claimed that every company offering lending or other financial services must register with the Office of the Attorney General (OAG) operating within the state.

On a separate cease letter, issued by the Division of Economic Justice Investor Protection Bureau with the OAG, New York’s AG confirmed to be in possession of alleged evidence against the unnamed companies. The AOG has provided these entities with 10 days to stop operating in the state.

As seen in the documents, sign by John Castiglione Senior Enforcement Counsel for the AOG, the names of the companies, the products, and other details have been covered as the cease period is still ongoing. In addition, the AOG accused the companies of trading in Bitcoin and other crypto-assets allegedly without proper registration.

Finally, the AOG demanded the companies protect the data related to such activities and make it accessible for the government agency. AG James said that crypto platforms need to “follow the law” revealing that other 3 companies in the space are currently under investigation. James added:

My office is responsible for ensuring industry players do not take advantage of unsuspecting investors. We’ve already taken action against a number of crypto platforms and coins that engaged in fraud or that illegally operated in New York. Today’s actions build on that work and send a message that we will not hesitate to take whatever actions are necessary against any company that thinks they are above the law.

The Crypto Community Speculates, Who Was Shut down By AG James?

The office of Attorney General James has led a crackdown on the crypto industry in 2021. According to the release, crypto companies operating in New York were notified about a change in registration operations that requiring them to inform about their activities to the Investor Protection Bureau.

James seems to have the same stand on the industry as other U.S. government officials, including Secretary of the Treasury Janet Yellen, and several lawmakers in the country. These officials act on the idea that cryptocurrencies are mostly used for illegal activities.

Previously, James closed crypto trading platforms Coinseed after legal actions. Other companies with billions of dollars invested in crypto assets, such as Saraca Media Group and GTV Media Group, were shut down by the AOG.

In that sense, the crypto community has been speculating on the possible companies targeted by the AOG. Lending platform Nexo and Celsius are the top candidates, but the former company issued a statement on the accusations via their official Twitter handle:

Nexo is not offering its Earn Product & Exchange in New York, so it makes little sense to be receiving a C&D for something we are not offering in NY anyway. But we will engage with the NY AG as this is a clear case of mixing up the letter’s recipients. We use IP-based geoblocking.

Seems like it might be Celsius & Zeus Ca….I mean Nexo.

Interesting BlockFi got a pass. https://t.co/EhMTyI7ozl

— Hsaka (@HsakaTrades) October 18, 2021