Because Nexo Capital failed to register the offer and sale of its Earn Interest product, the United States Securities and Exchange Commission (SEC) and the North American Securities Administrators Association (NASAA) have agreed to impose sanctions against the cryptocurrency lender in the amount of $45 million (PEI).

On January 19, the SEC and NASAA each issued their own statement announcing the news to the public.

According to the statement issued by the SEC, Nexo reached an agreement with the agency to make a penalty payment of $22.5 million and to discontinue its unregistered offering and sale of the EIP to investors in the United States.

According to the article, the additional $22.5 million penalty will be paid to address comparable allegations brought by state regulatory agencies.

According to a statement issued by NASAA, the agreement was reached in principle following investigations into the allegedly fraudulent offer and sale of Nexo securities that took place over the course of the previous year. During the course of the investigation, it was discovered that EIP investors had the potential to receive interest on the digital assets they had lent to Nexo to generate passive income. “Nexo exercised full autonomy in determining which trades would make money and be used to generate returns for investors.

Through its website and other social media platforms, the company sold and advertised the EIP, as well as other products, to potential investors in the United States. The company suggested, under certain circumstances, that potential investors could earn returns of up to 36%.

The Securities and Exchange Commission (SEC) noted that throughout the negotiation process for the deal, the commission took into account the degree of cooperation from Nexo, as well as the corrective actions that Nexo quickly implemented to remedy its deficiencies.