Kentucky Orders BlockFi to Stop Signing Up New Interest Accounts

in blockfi •  3 years ago 

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Kentucky is the fifth state to allege BlockFi Interest Accounts are securities.

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The Kentucky Department of Financial Institutions has become the fifth state regulator to claim that BlockFi’s interest service violates state securities laws.

Kentucky’s Division of Securities ordered the crypto lender to stop opening new accounts in the Bluegrass State. Kentucky joins New Jersey, Alabama, Vermont and Texas in alleging that BlockFi Interest Accounts (BIAs) violate state securities laws.

“‘Blockfi’s website offers cryptocurrency lending and borrowing services through ‘Blockfi Interest Accounts’ (BIAs) advertised on its website. Through these accounts, investors may deposit certain cryptocurrencies with the company in exchange for a specified interest rate.’ The company has accepted nearly $15 billion in these accounts from investors,” the regulator said in a press release.

In response, BlockFi announced it would “immediately” stop signing on new customers in Kentucky.

Existing customers remain unaffected. Kentucky joins Texas in filing for a cease-and-desist, while New Jersey, Alabama and Vermont have filed “show-cause” orders.

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