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Abra Settles with Texas Regulator, Will Open Withdrawals for 12,000 Customers

Finance Magnates

Cryptocoins News / Finance Magnates 40 Views

The crypto lender Abra has entered into a settlement with the Texas State Securities Board, agreeing to return the frozen funds of the customers. According to yesterday’s (Monday) announcement, the company currently holds about $13.6 million in crypto assets for roughly 12,000 investors.

Withdrawals Will Start

Under the settlement terms, Abra clients with a balance of more than $10 will receive a notification detailing the withdrawal procedure. They will have a seven-day window to make the withdrawals. For the unclaimed proceeds, the company will convert them to US dollars and send checks to the investors in Texas. Abra must complete the other stipulations under the settlement agreement within 30 days.

“Our agency recognizes that financial losses can have a devastating impact on retirement planning, college savings, and even the ability to pay routine bills and expenses,” said Joe Rotunda, the Enforcement Director at the Texas State Securities Board. “When settling this matter, we prioritized returning money to retail investors.”

Actions against Abra

William Barhydt founded Abra in 2014 and offers cryptocurrency trading, lending, and borrowing services to retail and institutional investors. It provides investment into Abra Earn and Abra Boost, which allegedly contained misleading statements. The interest rate offered by the platform is 10 percent.

The Texas regulator went after Abra and its founder in mid-2023, issuing a cease-and-desist order, claiming that the company had been insolvent since at least 31 March 2023. The regulator further claimed that Abra "made offers of investments in Abra Earn in Texas containing statements that were materially misleading or otherwise likely to deceive the public."

The latest settlement dismissed the earlier actions against the company and its founder. Abra is additionally winding down its retail operations in the United States, and the process has been accelerated with the latest settlement. The firm is one of several crypto lender companies to face regulatory action in the United States. Earlier, companies like BlockFi and Nexo settled with US regulators, paying hefty fines.

This article was written by Arnab Shome at www.financemagnates.com.
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