Celsius responds to NYAG crackdown on crypto lending platforms
“If any regulatory or technical changes are required in a specific jurisdiction, Celsius will provide clear and timely communication as needed,” said the firm.
Crypto lending firm Celsius Network has confirmed it is one of three platforms requested to provide information to the New York Attorney General’s office.
In a Tuesday blog post, Celsius said it was not one of the two unnamed crypto lending platforms that New York Attorney General Letitia James ordered to “cease any and all such activity” around selling or offering cryptocurrencies. Rather, Celsius said it was “working on providing regulators in New York” with information regarding its business.
“If any regulatory or technical changes are required in a specific jurisdiction, Celsius will provide clear and timely communication as needed,” said the lending platform. “We know that the only way to thrive and ensure our long-term growth is through clear regulatory guidance. We anticipate and plan for these kinds of routine checks and balances.”
The statement from Celsius comes following the NYAG’s office issuing a non-legally binding request for information from three unnamed crypto lending platforms operating in the state — although the AG did hint at a possible subpoena. James asked the businesses to provide details on their lending products, policies, procedures, clients in New York and other relevant information.
While Celsius has not received a cease and desist order from New York state, the platform is the target of regulators in Texas and New Jersey. On Sept. 17, the Texas State Securities Board filed for a hearing with the potential to impose a cease and desist order against crypto Celsius for allegedly not offering securities licensed at the state or federal level. The same day, the New Jersey Bureau of Securities ordered the lending platform to stop offering and selling interest-earning cryptocurrency products.
A Celsius spokesperson said at the time that it “wholeheartedly disagreed” with the allegations and was working with United States regulators “to operate in full compliance with the law.” According to the platform’s response to the NYAG’s request for information, Celsius is “having a very open and productive dialogue with regulators around the world.”
Of the other four firms targeted in the NYAG crackdown, Nexo Financial confirmed on Monday it received one of the two cease and desist orders. However, according to a Nexo spokesperson, the company does not offer its Earn Product and Exchange in New York state.
“It makes little sense to be receiving a cease and desist order for something we are not offering in New York anyway,” said the spokesperson. “We will engage with the NYAG as this is a clear case of mixing up the recipients of the letter.”
The other three companies that received notices from the NYAG remain unidentified. Under New York law, all crypto brokers, dealers, salespersons and investment advisers must register with the NYAG’s Investor Protection Bureau if they are doing business in the state. Those without an exemption who fail to do so will be subject to civil and criminal penalties.