The Celsius Network Appears To Be In Trouble With Regulators

The Celsius Network is in trouble…..

State regulators in both Texas and New Jersey are reportedly going after the crypto lending network, citing a lack of regulatory oversight on the popular platform.

Hearings are set to take place in Texas to discuss a regulatory framework for securities that regulators say are not registered with the proper agencies and state authorities.

According to sources, Celsius holds roughly $24 billion in assets.

Here’s more on the story:

NEW: Texas has accused Celsius Network, which purports to be one of the world’s largest cryptocurrency lenders, of offering residents unregistered securities https://t.co/3usWebu4J1

— Bloomberg Technology (@technology) September 17, 2021

1. To all @CelsiusNetwork clients, partners and ambassadors

With regards to recent actions by the states of TX, NJ & AL

We are disappointed these actions have been filed and wholeheartedly disagree with the allegations being made that Celsius has not complied with the law.

— Alex Mashinsky ©️ (@Mashinsky) September 17, 2021

Coin Telegraph had more details:

Texas’ Enforcement Division of the State Securities Board notified Celsius on May 14 that it may not have been in compliance with the state’s Securities Act.

In a Sept. 17 filing, it alleged that the platform’s Earn Interest-Bearing Accounts were in violation of Section 4.A of the Securities Act, saying they constituted “investment contracts, notes, or evidences of indebtedness regulated as securities.”

The allegations against Celsius are similar to those both state regulators — as well as their peer in Alabama — levied against crypto lending platform BlockFi in July.

JUST IN: Just hours after securities regulators in Texas served crypto lender @CelsiusNetwork with an order to appear in court, New Jersey has filed a cease-and-desist on similar allegations.@zackseward reportshttps://t.co/6xzIZdhF4x pic.twitter.com/026wuYVHsw

— CoinDesk (@CoinDesk) September 17, 2021

The 1% & 99% always had a rough relationship
Trickledown economics promised to keep the 99% happy, life will get better if they just kept quiet and did not try revolting@CelsiusNetwork swaps the trickle with a torrent of yield and flooded the 99% with $800m#UnbankYourself NOW

— Alex Mashinsky ©️ (@Mashinsky) September 17, 2021

Coin Desk reiterated New Jersey Attorney General Andrew Bruck’s call for tighter controls:

“If you sell securities in NJ, you need to comply with NJ’s securities laws. And that includes those operating in the cryptocurrency market,” tweeted New Jersey Acting Attorney General Andrew Bruck. “Our Bureau of Securities has ordered an NJ-based company – Celsius – to stop offering interest-bearing accounts.”

New Jersey and Texas were also among the states to slap crypto lender BlockFi with similar actions in July.

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