SEC Fines Nexo $45 Million for Unregistered Crypto Asset Offerings

• The US Securities and Exchange Commission (SEC) has levied a $45 million fine on Nexo Capital Inc. for failing to register the offer and sale of its retail crypto asset lending product, the Earn Interest Product (EIP).
• To settle the charges, Nexo agreed to pay $22.5 million and cease its unregistered offer and sale of the EIP to US investors.
• The SEC Chairman, Gary Gensler, has reinforced that crypto organizations must comply with its policies, or face the consequences for failing to do so.

The US Securities and Exchange Commission (SEC) recently levied a hefty $45 million fine on Nexo Capital Inc. for failing to register the offer and sale of its retail crypto asset lending product, the Earn Interest Product (EIP). The SEC order states that Nexo used the EIP service to fund interest payments and injunctions, making it a security.

According to the SEC, Nexo had offered and sold the EIP to US investors without registering it as a security, thus violating federal securities laws. To settle the charges, Nexo agreed to pay $22.5 million and cease its unregistered offer and sale of the EIP to US investors. The SEC has also stated that $22 million of the fine will be paid to State Regulatory Authorities for settling the claims made by them.

SEC Chairman Gary Gensler has commented on the matter by reinforcing that crypto organizations must comply with its policies, or face the consequences for failing to do so. He stated, “This action underscores the importance of crypto companies adhering to securities laws and the SEC’s registration requirements.”

The SEC began investigating Nexo in June 2020 after several states in the USA filed for a cease-and-desist order on the company’s EIP service. These states included California, Oklahoma, Vermont, South Carolina, Kentucky, and Maryland, who all alleged that Nexo’s earn-interest service was not registered as a Security.

The SEC order also noted that Nexo had misled investors by suggesting that the EIP was a safe investment, when in fact it was not. The SEC has further warned other crypto companies and investors to be aware of the risks associated with investing in unregistered securities.

The hefty $45 million fine imposed on Nexo is a reminder of the SEC’s commitment to enforcing its regulations and protecting investors from potential fraud and abuse. It is also a warning to all crypto companies to ensure that they comply with the SEC’s regulations and registration requirements.

Investing in unregistered securities carries a significant amount of risk, and investors should always be aware of the potential consequences of such investments. The SEC’s enforcement action against Nexo is a good reminder of the importance of adhering to the SEC’s laws and regulations.

Crypto Market Surges as Bitcoin Hits $20,000, but High Funding Rates May Lead to Pullback

• The crypto market has had a bullish run in the start of 2023, with Bitcoin gaining 17% and surpassing $20,000.
• Crypto Quant contributor Maartun has noted that Bitcoin’s high funding rates usually result in a price pullback.
• Funding rates are payments made to traders maintaining the price of perpetual contracts close to the spot price of an asset.

The start of 2023 has brought much excitement to the crypto market as several assets have experienced significant profits in the last few days. Bitcoin, the world’s biggest digital asset and market leader, has been the top-performing coin, surging past the $20,000 price mark for the first time since the start of the FTX crisis. The coin has gained approximately 17% over the last seven days, resulting in much enthusiasm and a rise in the positive sentiment around the entire crypto market.

However, investors are being warned to be alert as Bitcoin’s high funding rates may lead to a price pullback. Funding rates refer to recurring payments made to either traders in a long or short position, depending on the difference between perpetual contract markets and spot prices. These payments are meant to keep the price of perpetual contracts near the spot price of an asset, in this case, Bitcoin. Maartun, a top analyst on the crypto analytics platform Crypto Quant, has noted that Bitcoin funding rates have attained their highest values in 14 months and this usually results in a price pullback.

Therefore, investors should be aware of the potential risks of investing in Bitcoin. Despite the warnings, the crypto market continues to be bullish and the surge in Bitcoin’s price has attracted many new investors to the space. Whether or not the market will experience a price pullback in the coming days remains to be seen.

Low Volatility Suggests Ethereum Price Ready for a Breakout

• On-chain data shows that Ethereum realized volatility has now declined to rare levels observed only three times before in history.
• The one-month realized volatility is an indicator that measures the standard deviation of daily returns from the mean for the market in question.
• Low values of the metric suggest returns haven’t deviated much from the mean, and hence that the price has been stuck in stale consolidation.

The on-chain analytics firm Glassnode recently reported that Ethereum’s „realized volatility“ is at a historically low level, suggesting that the market is currently providing a low trading risk. Realized volatility is an indicator that measures the standard deviation of daily returns from the mean for the market in question. Generally, the most useful timespans for this metric are the one-week and one-month versions.

The one-month realized volatility for Ethereum has now dropped to just 39.8%, a level that has only been seen three times before in history. This suggests that the past month has had very little diversity in the price of Ethereum, and that the returns have not deviated much from the mean. This indicates that the price of Ethereum has been stuck in a state of consolidation, with no major price changes taking place.

As a result, analysts believe that Ethereum’s price could be ready for a breakout, as the low volatility implies that the market is becoming increasingly stable. This could lead to more investors entering the market, as they see it as a safe investment option. Furthermore, the low volatility indicates that the price of Ethereum is unlikely to crash suddenly, as the market is not as volatile as it used to be.

On the other hand, some analysts argue that the low volatility could be a sign of stagnation in the Ethereum market, as there may not be enough market activity to drive prices higher. Nevertheless, it seems that the low volatility could be a positive sign for Ethereum in the long run, as it indicates that the market is maturing and becoming more stable.

Flare Network Airdrop to XRP Holders Begins: FLR Token Drops 55% Ahead of Launch

• In late 2020, the Flare Network announced an airdrop of its Flare (FLR) tokens to all XRP holders.
• Just before the launch, the FLR/USDT trading pair on Bitrue saw a massive dump of around 71%, causing the token to drop from $0.5394 to $0.2395 at press time.
• The FLR Token Distribution event is just 24 hours away, with the stream starting a few minutes before 23:59 UTC.

The Ripple (XRP) community has been abuzz with the news of the Flare Network’s announcement of an airdrop of its Flare (FLR) tokens to all XRP holders. The creators of the project had intended to open up the DeFi space for Ripple and the airdrop was seen by many as a major step in that direction. However, holders of XRP had to be patient for a long time as the launch was postponed several times.

But now, the time has finally come. The FLR Token Distribution event is just 24 hours away and the Flare team and guests will be live on Twitter tomorrow at 6:59 p.m. EST. The stream will start a few minutes before 23:59 UTC sharp.

Unfortunately, just before the launch, the FLR/USDT trading pair on Bitrue saw a massive dump of around 71%, causing the token to drop from $0.5394 to $0.2395 at press time. With this, the FLR token is still posting a loss of around 55% compared to two days ago.

The market situation has dampened some of the enthusiasm of the XRP holders in anticipation of the airdrop. However, the Flare team is confident that the launch will still be a success and will help to further increase the adoption of the token. With the launch of the Flare Network, Ripple holders will now have access to a wide range of decentralized finance (DeFi) services which was previously not available.

It remains to be seen how the launch of the Flare Network will affect the XRP community and the FLR token in the long run. But for now, all eyes are on the FLR Token Distribution event and the Ripple (XRP) community is eagerly awaiting the launch.