The US Securities and Exchange Commission is investigating BlockFi crypto lending firm over high-yield, interest-bearing accounts.
The investigation seeks to determine whether the digital lending firm’s savings accounts have any similarities with securities to warrant registration.
The crypto lending platform also came under scrutiny by state regulators in Alabama, Texas, and New Jersey in July over what was termed an unregistered securities offering.
BlockFi has gained popularity with its digital savings accounts, allowing users to earn a 9.5% annual yield. The digital accounts are reportedly not regulated by the federal government.
The probe comes as the SEC moves to tighten rules in the crypto space. The agency threatened to sue Coinbase Global in September over a similar lending program that offered 4%, forcing the exchange to stop the plan.
BlockFi, currently valued at $4 billion, was started in 2017 and now operates over half a million retail accounts.
Source: Markets Insider