BlockFi has been served with outages and layoffs in New Jersey

BlockFi was served a cease and desist order in New Jersey and now the company must stop serving new customers as we can see more on their latest crypto news.

In the latest blow from one of the biggest names in the industry, New Jersey AG accused BlockFi of violating securities laws. However, the allegations of violation of securities laws are still unclear. The New Jersey Attorney General has issued BlockFi a cease and desist order to stop accepting new clients, CEO Zac Prince tweeted. This news is a blow to the company, one of the most well-known in the crypto space, known for providing up to 8% returns to those willing to borrow crypto. Prince says the company can continue to serve existing customers in other jurisdictions:

“Order instructs BlockFi to stop accepting [BlockFi Interest Account] New Jersey residents as of July 22, 2021. “

Forbes was the first to report the shutdown after receiving a draft press release from the AG’s office. The publication cited a comment from Acting Attorney General Andrew J. Bruck alleging that BlockFi violated securities laws. Bruck commented:

“Our rules are simple: If you sell securities in New Jersey, you must comply with New Jersey securities laws. Nobody gets a free card just because they are in the rapidly evolving cryptocurrency market. Our securities bureau will be closely following this matter as we work to protect investors. ”

It remains to be seen whether the entire operation of BlockFi violates securities laws or whether there are problems with certain transactions as the federal regulators do not declare BTC and ETH as securities. In any case, BlockFi has serious regulatory issues and the question remains whether federal regulators, particularly in New York, will take legal action against the company.

BlockFi is a favorite among crypto investors as it has raised $ 450 million to date and has a valuation of $ 3 billion. It has had some issues over the years, particularly in May when it struggled to send rewards in BTC rather than dollars, resulting in massive debt. All of this has raised the question of whether the platform is safe for consumers. Meanwhile, news of the investigation appears to have pushed the price of Bitcoin down.

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