TradeStation Losses! Pay $3 Million to End Dispute with SEC – Bittime

TradeStation Crypto is facing charges from the Securities and Exchange Commission (SEC) regarding the offering and sale of unregistered crypto lending products. On June 30, 2022, TradeStation voluntarily stopped offering interest features to investors, and the company has announced its intention to discontinue all crypto-related products and services in the US market on February 22, 2024.

Although TradeStation did not admit or deny the SEC's claims, the company agreed to comply with the cease-and-desist order.

As a result, TradeStation will pay a $1.5 million fine to the SEC. Stacy Bogert, associate director of the SEC's Division of Enforcement, stated, "This case highlights the importance of ensuring that investors benefit from the disclosure requirements provided by the federal securities laws, regardless of the label applied to the offering."

In the context of separate settlements with eight states, including California, Mississippi, North Carolina, Ohio, and South Carolina, TradeStation also agreed to pay $1.5 million as part of the multi-state settlement.

In the period August 2021 to June 2022, TradeStation offered a crypto interest earning program to at least 142 investors in New Jersey.

The SEC accused TradeStation of selling crypto lending products in 2020 with interest features. This product is marketed as a way for investors to earn interest on their crypto assets. TradeStation has complete control over how it manages assets to generate income that can be used to pay interest to investors.

However, the SEC stated that TradeStation did not register the offer and sale of the crypto lending product before offering it to investors.

While TradeStation does not provide comment on regulatory investigations and settlements, these events highlight the challenges and complexities of detailing crypto-related financial products under an evolving regulatory framework.

As scrutiny and enforcement in the crypto space increases, companies and financial platforms operating in the sector must ensure full compliance with applicable regulations and registrations.

Settlement agreements like the one experienced by TradeStation are part of regulators' efforts to mitigate risks and protect investors' interests in this ever-evolving market.

Unraveling ENS and DNS: An In-Depth Look at Web3 and Web2 Identities

Web3 Trend Footsteps: Internet Transformation Towards Decentralization

DISCLAIMER: This article is informational in nature and is not an offer or solicitation to sell or buy any crypto assets. Trading crypto assets is a high-risk activity. Crypto asset prices are volatile, where prices can change significantly from time to time and Bittime is not responsible for changes in fluctuations in crypto asset exchange rates.

Related to