Due to Nexo Capital’s failure to register the offer and sale of its Earn Interest Product, the United States Securities and Exchange Commission (SEC) and the North American Securities Administrators Association (NASAA) have agreed to levy penalties against the cryptocurrency lender in the amount of $45 million (EIP).
On January 19, the SEC and the NASAA each released their own statement announcing the news to the public.
According to the statement released by the SEC, Nexo has come to an agreement with the agency to make a penalty payment of $22.5 million and to discontinue its unregistered offer and sale of the EIP to investors in the United States.
According to the article, the extra fine amount of $22.5 million will be paid to address comparable allegations brought forth by state regulatory agencies.
According to a statement released by NASAA, the settlement in principle was reached following investigations into Nexo’s allegedly fraudulent offer and sale of securities that took place over the course of the previous year. During the course of the inquiry, it was found out that EIP investors had the potential to receive interest on digital assets that they had lent to Nexo in order to generate passive income. “Nexo exercised complete autonomy in determining which operations would generate money and be used to generate returns for investors.
Through its website and other social media platforms, the firm sold and advertised the EIP as well as other goods to potential investors in the United States. The company suggested, in certain circumstances, that potential investors might get returns of up to 36% “that was said.
The Securities and Exchange Commission (SEC) noted that throughout the negotiating process for the settlement, the commission took into account Nexo’s degree of cooperation as well as the corrective actions that were swiftly implemented by Nexo in order to remedy their deficiencies.
This article was originally reported on Blockchain News.