Regulators Intensify Scrutiny of Voyager And Celsius

Securities regulators in Texas and Alabama are expanding their investigations into the collapse of crypto platforms Voyager Digital VYGVF and Celsius Network.

According to Bloomberg, the regulators are investigating if the crypto firms kept information hidden about their loans and creditworthiness of the borrowers. 

"What we're seeing now is that a lot of these crypto-lending firms may not have fully disclosed what they were doing on the backside with investors' money," Bloomberg quoted the director of enforcement at the Texas State Securities Board Joe Rotunda saying. 

Also Read: How Bankrupt Voyager Plans To Return Crypto To Customers

Texas, Alabama, and New Jersey regulators have each opened investigations into crypto exchanges. 

The regulators are investigating any yield-product offerings at both the crypto firms. Regulators are also checking whether they were unregistered securities. Earlier, both the crypto firms offered high rates of return, such as 12% and 17%, respectively.

Last week, Voyager digital filed for Chapter 11 bankruptcy protection in New York. 

Voyager has approximately $1.3 billion of cryptocurrency assets on its platform, besides claims against Three Arrows Capital (3AC) of more than $650 million.

Photo via T. Schneider on Shutterstock