The District of Columbia reports that it is part of a $100 million settlement with digital asset lending platform BlockFi Lending.
The Department of Insurance, Securities and Banking (DISB) said the settlement is related to the company’s sales of unregistered securities in violation of state law.
DISB is expected to receive $944,000 out of the settlement with 31 state securities regulators and the federal Securities and Exchange Commission. DISB said the money will be used to support consumer protection efforts in the District.
In January 2021, a multistate working group notified BlockFi that it may have offered and sold securities not in compliance with state securities laws. In July and September 2021, Alabama, Kentucky, New Jersey, Texas, Vermont, and Washington filed state securities actions against BlockFi concerning its offer and sale of unregistered securities.
BlockFi has agreed to pay $50 million to the 53 North American Securities Administrators Association member agencies and $50 million to the SEC. The 53 NASAA member agencies will share equally in the settlement, each receiving $943,396 after executing the appropriate consent orders.
BlockFi’s agreement comes amidst rising concerns over the proliferation of “decentralized” and digital asset-based financial products and services targeting retail investors.
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