On July 23, 2018, the California Department of Business Oversight (DBO) announced that it had taken action against 11 crypto currency firms. The firms were accused of engaging in unlicensed activity and of violating California’s money transmission laws. Click this image below to start bitcoin trading.
According to the DBO, the firms had failed to comply with state regulations, and some of them had been operating without licenses for years. In a statement, DBO Director Andrea J. Aiello said that the agency was “committed to protecting consumers and ensuring that California’s financial services sector remains healthy and strong.”
The DBO’s actions against the crypto currency firms came amid a wider crackdown on the crypto industry by U.S. regulators. In recent months, the Securities and Exchange Commission (SEC) and the Commodity Futures Trading Commission (CFTC) have both issued warnings about the risks associated with investing in crypto currencies.
What actions did California take?
California took a number of actions in order to respond to the drought. One of the most important was to pass a water conservation law that required all cities and towns to reduce their water usage by 25%. The state also offered financial incentives for homeowners and businesses to install water-efficient appliances and landscaping. In addition, California worked to improve its water storage and delivery systems, and increased funding for research on drought-tolerant plants. The California Department of Financial Protection and Innovation (DFPI) issued cease-and-desist orders against 11 unknown crypt currency companies on Tuesday, saying that they were misappropriating consumer cash or breaching state securities rules.
The regulator even questioned if the organisations, which included Elevate Pass LLC and Metafi Yielders, have been genuinely providing the services they claimed. According to the regulator, each of the 11 firms reportedly marketed and sold unqualified securities, and ten of them also committed major misstatements and omissions to investors.
Why did California take these actions?
The state of California took the actions it did in response to the drought because it was necessary to preserve the state’s water supply. The state’s reservoirs were running low, and the snowpack in the Sierra Nevada Mountains was at an all-time low. If the state had not taken these actions, it would have run out of water. Previous schemes aimed at potential investors have provided high-yield financial products in other areas like as oil and gas, according to the regulator.
Each of the organisations had a referral programme that functioned similarly to a pyramid scheme “According to the press release.” The organisations promised to pay investors fees if they brought in new investors, as well as extra commissions if indeed the investors they brought in brought in new investors. The referral schemes had the desired effect of motivating investors to develop and distribute material on social media platforms like YouTube in order to persuade everyone else to invest in these businesses. The enforcement measures came only one day after California wanted to join a coalition of states in suing cryptocurrency lender Nexo, saying that its Earn product violated securities laws.
What are the implications of these actions?
The implications of these actions are vast. For one, the United States is now in direct violation of the nuclear agreement that was reached in 2015. Furthermore, this could trigger a new arms race in the Middle East, as Saudi Arabia and other nations in the region may now seek to develop their own nuclear programs. It is also possible that Iran could retaliate by restarting its nuclear program, setting off a dangerous chain reaction. Finally, this will further isolate the United States from its allies, who have all urged the Trump administration to uphold the agreement. The DFPI’s action follows its Monday stop and desist letter to bitcoin lender Nexo. According to the regulator’s complaint, Nexo has been marketing and selling “unqualified securities, in the guise of Earn Interest Product accounts” since “at least June 2020.” According to the 11 cease and desist orders filed on Tuesday, the organisations reportedly provided “typical instances of good dividend investment strategies (HYIPs).” Among the 11 crypto businesses cited in the cease and desist orders are: COTP Elevate Pass LLC d/b/a Cryptos OTC Trading Platform Limited, Greencorp Investment Corporation, Metafiyielders Pty Ltd, often known as Metafi Yielders Pegasus, ME Polinur Limited, Vexam Limited Remabit Sity Trade Sytrex Trade, World Over the Counter Limited, often known as World OTC.
