While federal regulators took no action, Borg and his counterparts in Texas, New Jersey, Kentucky and Vermont targeted the operations of two key crypto players at the heart of this summer’s crypto meltdown, Celsius and Voyager, filing cease and desist orders against them months before the self-styled crypto banks declared bankruptcy.
The state financial watchdogs also were way ahead of the feds in the summer of 2021 when they issued cease-and-desist order against BlockFi, another rapidly growing crypto bank, leading to a $100 million, first-of-its-kind settlement for securities law violations. The Securities and Exchange Commission, the federal agency most often thought of as the crypto watchdog, joined talks between the two sides only as they neared a deal, state regulators say.
Now, Borg and his fellow state regulators are working to help hundreds of thousands of Celsius and Voyager customers recoup billions of dollars worth of assets from frozen accounts. Again, federal regulators are either largely silent or late to the action. The Federal Reserve and the Federal Deposit Insurance Corporation only wrote Voyager demanding it drop “false and misleading” marketing claims three weeks after it had declared bankruptcy.
‘Enforcement 40’ for 2020
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