Voyager Digital slammed for offering crypto interest-bearing accounts

After BlockFi, Canadian cryptocurrency platform Voyager Digital is being slammed for offering interest-bearing cryptocurrency accounts.

State regulators of New Jersey have filed for a cease and desist order to prevent Voyager Digital from offering its high-yield crypto products. The authorities believe that the investment app is selling unregistered securities in the form of interest-bearing accounts.

At present, Voyager Digital claims to offer rewards of up to 12% annually on more than 35 cryptocurrencies. The platform also allows users to trade 85 cryptocurrencies via its app. According to the news release filed by the New Jersey Bureau of Securities, Voyager Digital’s interest-bearing accounts hold over $5 billion in assets from approximately 1,530,000 customers.

Apart from the northeastern state, regulators from Texas and Alabama have issued suspension orders asking the company to shut down “Earn Program” accounts. Some other state regulators have ordered Voyager Digital to immediately suspend the opening of any new accounts. Acting Bureau Chief Amy G. Kopleton said:

“Platforms like Voyager that offer interest-bearing financial products may mirror the traditional financial structures we know and trust, but their lack of a protective scheme or regulatory oversight subjects investors to additional risks not borne by those who maintain assets with most SIPC member broker-dealers, or with banks, savings associations, or credit unions.”

Voyager’s case is similar to BlockFi, a New Jersey-based crypto platform that was charged by several state regulators and the US SEC for offering its high-yield lending product of “unregistered securities.” The company agreed to pay $100 million in settlement charges in February this year.

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