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Nexo will cancel profitable product after paying $45 million

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Nexo will cancel profitable product after paying $45 million

Source: blockchain.news

After agreeing to pay $45 million in fines to US regulators, cryptocurrency lending firm Nexo Capital has decided to end its Earn Interest with Yield product for its clients in the United States. This decision will take place approximately one month after the company reached the agreement.

Nexo made the announcement via a blog post on February 10, saying that all production of the product will cease on April 1. By lending particular cryptocurrencies to Nexo, users were able to participate in the scheme and receive daily compounded returns on those coins.

Nexo said settlements it reached on Jan. 19 with the Securities and Exchange Commission and the North American Securities Managers Association were the reason it had to call off Earn’s offer.

Because Nexo failed to register the offer and sale of its Earn product, the SEC, NASAA, and at least 17 state securities authorities conducted an investigation against the company.

In addition to paying a $22.5 million fine and reaching an agreement with the SEC to stop marketing its Earn product to investors in the United States, Nexo also agreed to pay an additional $22.5 million in penalties to address allegations brought by the state authorities.

Nexo did not confirm or refute the SEC’s findings, but the company has agreed to a cease and desist order barring it from violating any aspect of securities law.

According to the Nexo statement, Earn users will continue to be compensated with interest until April 1. Nexo encourages consumers to “start preparing to withdraw your money” before the end date of the fixed-term product so that they can access the product once it has been unlocked.

According to the company, other Nexo services and products would not be negatively affected in any way.

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