Iowa’s insurance commissioner says a cryptocurrency company will pay a more thn $943,000 fine to the State of Iowa for selling unregistered securities and misrepresenting the level of risk associated with its product.
BlockFi Lending has offered interest-bearing accounts to customers with cryptocurrency, promising to make variable interest payments each month. Two and a half years ago, BlockFi and its affiliates held about $267,000 worth of crypto from Iowans and by the end of 2021, that had ballooned to $14.6 million according to a news release from the insurance commissioner’s office..
The company was accused of selling securities in Iowa without being registered as a broker-dealer or agent. The Iowa Insurance Commissioner’s announcement is part of a joint investigation by a federal agency and state regulators. BlockFi has agreed to pay $50 million to the Securities and Exchange Commission. Iowa’s insurance commission says the company is paying another $50 million dollars to 50 states, the District of Columbia, Puerto Rico and the U.S. Virgin Islands.
BlockFi agreed to the $100 million dollar without admitting or denying the SEC’s allegations.