All the businesses were anonymous. Both platforms have been ordered to cease all activities within 10 days of October 18 for “illegal sale or offering of securities and / or commodities,” as required by New York law. Martin Law, which requires bidders to register, according to the letter.
Meanwhile, the other three have been asked to provide more information on how they work, such as what they do with the cryptocurrencies deposited on their platforms. Details should include all wallet addresses and custodial entities, under a separate letter. The attorney general also asked for clarification on whether the platforms accept fiat currency or accept the tether as collateral.
“Cryptocurrency platforms have to follow the law, like everyone else,” James said in a declaration. “My office is responsible for ensuring that industry players do not take advantage of unsuspecting investors.”
She also discussed in detail the state’s Martin Law, which includes a broad list of instruments that should be declared as securities. This includes “all shares, bonds, notes… or negotiable property titles, or orders, calls or options in foreign currencies in this regard, hereinafter referred to as securities or transferable securities”.
“The nature and function of the most common virtual currency lending products or services demonstrate that they clearly fall within one of the many categories of ‘security’ under the Martin Act,” the declaration noted.
The state attorney general’s office has stepped up its crackdown on virtual currencies. For example, the crypto-trading platform Coinseed announced in June its closure after being sued by James in February for selling “valueless“and move investor money without permission.
Cryptocurrencies have been at the center of a period of tension as global regulators confer on how best to increase oversight of the $ 2.6 billion industry.
Multiple efforts to master various products were imposed. Still, the market capitalization of digital assets continues to soar – now supported by a looming bitcoin futures exchange-traded fund set to start trading this week.