Nexo has paid a $45 million fine to settle charges brought by the SEC that its Earn Interest Protocol was not registered for sale to US investors. The company has also ceased operations for the unregistered product in the country. The former SEC chief, John Reed Stark, criticised Nexo’s claims of regulatory victory and innovation, describing it as “absurd spin”. The FinTech claims they did not admit wrongdoing, but some in the industry suggest that Nexo and Coinbase have been treated leniently compared to Ripple’s SEC lawsuit. Meanwhile, Gemini’s investors have filed for legal action against Barry DCG over alleged fraud.
The Daily Crypto News
Welcome back to another episode of The Daily Crypto News with your host, Dusty. Today, we have a very interesting story about the state of regulations in the crypto world. While Dusty is bullish on crypto, he believes that the current approach to regulations is flawed. Today’s episode covers a range of topics, including XRP, FTX, SEC, and a well-known lawyer in the XRP community.
XRP and FTX
Let’s start with XRP and FTX. The crypto market is currently in a neutral position. The entire market is at roughly one trillion dollars, with Bitcoin up about 1.5%, Ethereum up about 2%, and XRP up roughly 1% over the last 24 hours. The best performing coin is Nexo, up about 17%, while the worst coin is debatable, but currently, Casper is down roughly 2.5% on the daily.
Nexo’s Deal with SEC
A former SEC Chief recently lashed out at Nexo’s $45 million deal with the SEC, claiming that Nexo’s claims of victory on regulatory authority and innovation after paying the fine hasn’t gone down well. The SEC charged Nexo with failing to register the offer and sale of its retail crypto asset lending product, the Earned Interest Protocol. To settle the charges, Nexo agreed to pay $22.5 million and seized its unregistered offer and sale of the EIP to US investors.
Former SEC Chief’s Take
The former SEC Chief, John Reed Stark, is not happy with Nexo’s claims of victory. He believes that such absurd spin is the latest crypto trend, and is critical of Nexo’s payment of $45 million to the SEC while claiming victory for innovation. Stark compares the situation to Blockfi, which similarly touted its $100 million SEC penalty as a victory for regulatory clarity.
DCG, the company that claimed all the money for themselves through the Earned Protocol, finds itself in a lot of trouble. They have filed for bankruptcy and are facing legal action from Gemini exchange, who were partners with them. Gemini wants some explanations and wants people to get their money back. The situation is likely to get juicier, with the Department of Justice investigating the transfer of funds between Genesis and DCG.
XRP Left in FTX
Finally, there is an interesting story about an urn that coincides with Nexo. DCG’s troubles may result in another lawsuit that could hit the crypto market hard. Meanwhile, almost $30 million worth of XRP remained in FTX, making it a risky investment. If you’re enjoying this episode of The Daily Crypto News, please press the like button to show our team how many people are watching the content.