TL; DR Breakdown
Voyager slammed with cease and desist orderThe firm has over 52,000 users in NJUS regulators continue to clamp down on high yield accounts
A New Jersey regulator has served crypto-based investment Voyager Digital with a cease and desist order. Going by the order details, the body mentioned that the company took advantage of its Voyager Earn feature to sell unlicensed securities. The company is widely known across the crypto sector for its staking and other crypto-related services to its users. The document states that Voyager refused to register all the staking and lending accounts in its confines.
Voyager has over 52,000 users in NJ
According to records, the Earn program has been on since 2019, with many traders owning an account. The body mentioned that the 12% interest pegged to each account is why it is unregistered. It also pointed to the inscription on Voyagers website in its evidence list. The company asked traders to grow their portfolios. The regulator also claims the company has over 1.5 million users grossing about $5 billion assets on the platform. Out of that number, about $187 million worth of assets belongs to the over 52,000 users located in the state.
US states clamp down on high yield accounts
The regulatory body also slammed the company’s advertising in marketing its products. It noted that the company under which it operates is not traded in the US, which was not hidden to traders beforehand. The order mentions that it creates a case for misleading traders about its parent company. The Bureau also mentioned that the company had not gotten a full operation license. This means that it cannot open up its programs to traders in some specific parts of the country.
Asides from New Jersey, other states have severed the company with the same order across the United States. This type of case has been growing across the United States, with a state serving BlockFi the same order some months ago and a $100 million fine. Coinbase was also stopped in its track in its launch of the Coinbase Lend feature after a warning from SEC. The program was said to have taken the shape of the BlockFi program that was canceled. During the period, Brain Armstrong faulted the stance of the SEC while noting that there was no legal backing for their warnings.
