While cryptocurrency lending platform Celsius Network (CEL) just completed a new round of funding worth $400 million, it has been asked by the New York Attorney General’s Office to provide information. However, the company denied that it was one of the companies targeted by the cryptocurrency lending cease-and-desist order.
Celsius asked to explain itself to the New York Attorney General
In an October 19 blog post, Celsius Network said it was not one of the targets of the cease-and-desist order ordered by the New York Attorney General. The injunction prohibits unregistered cryptocurrency lending platforms from offering their services. As far as we know, Nexo Financial has reportedly been targeted by this injunction. However, it denied the Bureau’s allegations, as it would not offer its services to New York users.
However, Celsius says it has received a request for information from the New York Attorney General. The information is related to the company and its possible subsidiaries, a full description of the products and explanations of the processes for storing or lending digital assets.
It will take more to throw off Celsius
As the popular expression dictates, Celsius is fighting the odds. In other words, in the face of this demand for accurate information, the company is far from complaining:
“We have a very open and productive dialogue with regulators around the world. (…) We want our community to know that other states may have questions or need more information from Celsius about our operations, and that we are committed to working in full cooperation with them.”
So Celsius appears to be fully prepared to work with regulators. Undeniably, Celsius is galvanized by the success of its most recent fundraising, which exploded its valuation to over $3 billion. However, Celsius is not unanimously accepted by the various financial regulatory authorities in the US states.
Indeed, three states have already challenged Celsius’ activities. For example, the Alabama Securities and Exchange Commission issued an order on September 16 to Celsius to explain why its products and services do not qualify as sales of securities as regulated by the Securities Act.
Alabama was quickly joined by the states of Texas and New Jersey, with the difference that the latter went on the offensive. Indeed, the regulatory authorities directly initiated administrative actions against Celsius.
Finally, it should be noted that the regulators are on all fronts. They are also making the decentralized finance (DeFi) players tremble, like Uniswap, which has chosen to withdraw products subject to contestation.
