Abra Reaches Settlement with Texas Securities Regulators
Cryptocurrency platform Abra has reached a settlement with Texas securities regulators, allowing users to withdraw their funds and ensuring compliance with existing securities laws. This marks a significant development in the regulation of digital asset services.
Withdrawal of Funds Addressing Concerns
The settlement agreement addresses concerns raised by the Texas State Securities Board and enables Abra users to withdraw their funds. Under the terms of the settlement, Abra must issue checks or secure bank instruments to clients with more than $10 in assets on the platform.
Compliance with Existing Securities Laws
Abra held approximately $13.6 million in crypto assets for around 12,000 customers at the time of the regulatory action. The settlement ensures compliance with existing securities laws and emphasizes their applicability to both traditional and innovative financial products.
Obligations and Distribution of Assets
The settlement stipulates a 30-day period for Abra and its CEO, William Barhydt, to fulfill their obligations. Any remaining assets will be converted to fiat currency and distributed to Texas investors. Barhydt is also required to appoint a chief compliance officer for relevant entities.
Cease and Desist Order and Challenges Faced
This agreement follows a cease and desist order issued to Abra and Barhydt in June due to misleading public statements related to investment offers. Abra faced challenges after the collapse of FTX and had to make personnel cuts before receiving the regulatory order.
Hot Take: Resolution Reached for Abra and Texas Securities Regulators
A settlement between Abra and Texas securities regulators has been reached, allowing users to withdraw their funds from the cryptocurrency platform. The agreement ensures compliance with existing securities laws and addresses concerns raised by the Texas State Securities Board. Abra must issue checks or secure bank instruments to clients with over $10 in assets, and any remaining assets will be converted to fiat currency for distribution to Texas investors. This resolution follows a cease and desist order issued to Abra and its CEO, William Barhydt, in June. It marks a significant step in regulating digital asset services and emphasizes the applicability of securities laws to traditional and innovative financial products.
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