California

Robinhood Settles With California for $3,900,000 After Probe Finds Users Were Blocked From Withdrawing Crypto

Published

3 months ago

September 6, 2024

Retail trading giant Robinhood is settling with the state of California for millions of dollars after an investigation uncovered users were stymied from withdrawing their funds.

In a new press release, California’s Department of Justice says that Attorney General Robert Bonta settled with the crypto branch of Robinhood for $3.9 million for failing to let customers withdraw crypto from their accounts between 2018 and 2022.

According to the state, Robinhood was in violation of the law because it allegedly sold commodities to traders without actually delivering the assets and then would not let customers withdraw their crypto to leave the platform. Instead, customers were allegedly forced to sell back their crypto in order to leave Robinhood.

Furthermore, the investigation concluded that Robinhood misled customers by claiming that its trading platform was operating through multiple marketplaces to find the best price on assets and that the platform itself would be holding customer assets.

As stated by Bonta in the press release,

“While cryptocurrency is fairly new, California has strong and enduring consumer protection laws that protect Californians against misrepresentation, including by cryptocurrency companies. Our investigation and settlement with Robinhood should send a strong message: Whether you’re a brick-and-mortar store or a cryptocurrency company, you must adhere to California’s consumer and investor protection laws.”

In addition to paying the penalty, Robinhood has also agreed to let customers withdraw their crypto assets from the platform to their own crypto wallets and to provide customers with proper disclosures and updates.

In the official settlement agreement, Robinhood did not admit or deny any violations of the law.

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Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any losses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.

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BlockFi

California permanently cuts off BlockFi’s license over bad lending practices

Published

2 weeks ago

November 9, 2024

admin

The California Department of Financial Protection and Innovation has permanently revoked BlockFi’s lending license following its bankruptcy and regulatory issues.

BlockFi, a crypto lending platform, collapsed in 2022 amid financial troubles tied to the downfall of crypto exchange FTX.

Today, we’re announcing we’ve revoked crypto lender BlockFi’s California Financing Law (CFL) license. BlockFi has agreed to a settlement that includes a revocation of its license and a cease-and-desist from harmful practices. More: https://t.co/gdi28TpY7H pic.twitter.com/S1uieLHbkP
— CA Department of Financial Protection & Innovation (@CaliforniaDFPI) November 8, 2024

BlockFi had extended a $400 million credit line to FTX, and FTX’s bankruptcy had ripple effects, contributing to BlockFi’s financial instability and eventual bankruptcy filing.

BlockFi’s rocky past

The DFPI’s revocation of BlockFi’s license stems from findings that the lender breached California’s Financing Law by failing to assess borrowers’ ability to repay and charging interest before loans were issued, according to a now-deleted DFPI press release.

BlockFi also did not provide required credit counseling and inaccurately disclosed loan terms, impacting borrowers’ credit scores and ability to access future loans.

In addition to the revocation, BlockFi reached a settlement with the DFPI, agreeing to stop unsafe practices. The regulator imposed a $175,000 fine, waiving the payment to focus on creditor repayments, per the release.

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California

Robinhood’s Former Ban on Crypto Withdrawals Draws $3.9M Settlement in California

Published

3 months ago

September 5, 2024

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“We are pleased to put this matter behind us,” said Lucas Moskowitz, Robinhood Markets’ general counsel in an emailed statement. “The settlement fully resolves the Attorney General’s concerns related to historical practices, and we look forward to continuing to make crypto more accessible and affordable to everyone.”

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Bitcoin

Santa Monica ‘Bitcoin Office’ section goes live on website

Published

3 months ago

August 11, 2024

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The city of Santa Monica, California officially added a “Bitcoin Office” section on its website to bolster industry partnerships and increase employment opportunities.

The move comes about a month after the Santa Monica City Council unanimously approved a pilot program for the Santa Monica Bitcoin (BTC) Office.

The initiative is being implemented at no cost to the city, officials say.

Following the approval of The City Council, Santa Monica unveiled the new section on its website on Thursday, Aug. 8.

The city’s administration is reportedly collaborating with the Proof of Workforce Foundation to educate Santa Monica-based residents and businesses about BTC and its transformative potential in the modern economy.

The Proof of Workforce Foundation is a nonprofit organization dedicated to bridging the gap between emerging digital technologies and local communities. The foundation, created in 2023, plans to equip individuals with the skills needed for the evolving job market and driving economic growth in Santa Monica.

Beyond its educational mandate, the Bitcoin Office aims to foster partnerships within the Bitcoin industry to bolster Santa Monica’s economic recovery and create new job opportunities.

According to the website page, the office will facilitate strategic collaborations to strengthen the local economy and position the “Silicon Beach” as a leading hub for Bitcoin innovation.

The office’s launch was followed by a promotional post about an upcoming Bitcoin festival, Bitcoin Peer-to-Peer, on X. According to the post, Santa Monica plans to host the event on Oct. 18, a day after the proposed date.

Santa Monica Vice Mayor Lana Negrete emphasized that the Santa Monica Bitcoin Office program is focused solely on education rather than the asset itself.

The initiative aligns with the council’s ongoing efforts to foster economic recovery for the city, Negrete said.

The program is expected to generate positive publicity for Santa Monica and boost tourism, notably as the city hosts the annual Pacific Bitcoin Festival, which attracts thousands of Bitcoin enthusiasts annually.

While promoting educational opportunities about cryptocurrency, Negrete clarified that the city is not endorsing Bitcoin investments. Instead, the program aims to enhance residents’ understanding of cryptocurrency’s functions, enabling them to make more informed decisions regarding its use and investment.

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