SEC, State Regulators Probe Crypto Lender Celsius Over Accounts Freeze – Regulation Bitcoin News

According to reports, the U.S. Securities and Exchange Commission and various state regulators are investigating the crypto lender Celsius Network’s decision to stop withdrawals.

U.S. Securities Regulators Investigate Celsius’ Withdrawal Freeze

According to Reuters, the U.S. SEC is investigating the withdrawal freeze decision made by Celsius Network, a crypto lender, according to Thursday’s report.

Texas’ director of enforcement Joseph Rotunda explained that officials representing the five state securities regulators met Monday morning to begin the investigation following Celsius’ withdrawal freeze announcement Sunday night.

Noting that the investigation is a “priority,” Rotunda said:

I am very concerned that clients – including many retail investors – may need to immediately access their assets yet are unable to withdraw from their accounts.

“The inability to access their investment may result in significant financial consequences,” he stressed.

Rotunda said he and his team learned about Celsius’ accounts freeze from the company’s tweet and blog post Sunday night.

“Due to extreme market conditions, today we are announcing that Celsius is pausing all withdrawals, swaps, and transfers between accounts,” the company wrote.

Joseph Borg from Alabama Securities Commission stated that Celsius was also in contact with them. Borg added that Celsius had responded to regulators’ questions.

Last year, regulators in a number of states, including Alabama, Kentucky, New Jersey, and Texas hit Celsius with a cease and desist order over the lender’s interest-bearing products, which they said should be registered as a security.

After freezing withdrawals, Celsius reportedly sought help from Akin Gump Strauss Hauer & Feld, a law firm that specializes in financial restructuring. Citigroup is being hired as advisor by the crypto lender.

Additionally, Bit Boy Ben Armstrong announced on Twitter Wednesday a class-action suit against Celsius CEO Alex Mashinsky

What do you think about U.S. securities regulators investigating Celsius’ accounts freeze? Comment below.

Kevin Helms

Kevin is a graduate of Austrian Economics. He discovered Bitcoin in 2011, and has been an advocate ever since. His main interests are in Bitcoin security, open source systems, network effects, cryptography, and intersections between economics, cryptography, and Cryptography.