Today in Crypto: BlockFi Could Pay $100M to SEC

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Crypto lender BlockFi will pay $100 million in a Securities and Exchange Commission settlement over a probe into selling unregistered securities, Bloomberg reported Friday (Feb. 11).

BlockFi will also stop opening new accounts for its high yield lending product, per the report.

The penalties are among the highest leveled at a crypto company. The U.S. has been increasingly cracking down more on those types of companies, with the news of companies raking in billions on promises of yields far above those available through regular savings accounts.

Meanwhile, Coinbase has been notified of a vulnerability in its trading systems, according to a CoinDesk report Friday.

The company suspended trading on its Advanced Trading platform for a time because of it. Around 6 p.m. on Friday, a ‘white hat hacker’ called Tree of Alpha notified Coinbase of a “market-nuking” exploit. It submitted a HackerOne report, referring to a platform running bug bounty programs for companies.

Tree of Alpha told CoinDesk via Twitter that the issue was “sensitive and could allow malicious users to send all Coinbase order books to arbitrary prices.”

In other news, divorcing couples can now add crypto to the list of things disputed in the courts, The New York Times reported Sunday (Feb. 13).

Erica and Francis deSouza, in their divorce, are disputing millions of dollars in missing bitcoin. The report says Francis, a tech executive, had bought a bit over a thousand bitcoins after separating from Erica in 2013.

He then lost almost half the funds when a big exchange collapsed. After some litigation, courts ruled in 2020 that he’d not properly disclosed some things about his investments.

Finally, Jonathan Steinberg, founder and CEO of WisdomTree Investments, said blockchain tech will become more important for payments in the future.

“It’s the convergence of blockchain technology with universal smartphone ownership and tokenization with smart contracts that will effectively blur the lines between savings, payments and investing, fundamentally changing the way consumers view and interact with their own money and assets,” Steinberg said, according to a SeekingAlpha report Sunday.

The company’s WisdomTree Prime digital wallet will be native to the blockchain and look like a regular mobile app, while offering digital financial benefits usually found on decentralized finance (DeFi) principles, per the report.

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