What are you announcing today?
On Monday, February 14 BlockFi announced it has reached a resolution with the Securities and Exchange Commission (SEC) and state securities regulators, which provides a framework for investors across the industry who want to earn interest on their crypto assets. As part of this resolution, we will be starting the registration process with the SEC for the offering of BlockFi Yield, what is anticipated to be the first SEC registered crypto interest-bearing security. We have always known that strong engagement with regulators would be critical for the ongoing market adoption of financial services powered by cryptocurrencies. This resolution provides a clear path forward to compliance with a new regulatory framework for our industry. Read more about this landmark resolution.
Why are you just telling me this now?
We understand that this is big news, and our priority is sharing it with you as soon as possible. This was the absolute fastest we could roll out this news to our valued clients! If you have specific questions about your experience, we would love to provide any clarity you need. Please reach out to our team here.
How does this impact U.S. BIA clients?
Existing U.S. BIA clients will maintain their accounts and receive interest as they always have, but cannot add new assets to their accounts as of February 14, 2022. New funds can only be added into a client’s BlockFi Wallet or to a BlockFi Personalized Yield.
How does this impact BIA clients outside of the U.S.?
Existing and prospective BlockFi clients outside of the U.S. are unaffected by these changes and continue to have full access to the platform, including opening new BIAs and adding assets to existing BIAs.
Can I still earn crypto interest in my BlockFi Interest Account?
Yes, you will continue to earn interest as you always have, but cannot add new assets to your account as of February 14, 2022. New funds can only be added into a client’s BlockFi Wallet or to a BlockFi Personalized Yield.
When can we expect BlockFi Yield?
This is dependent upon the registration process with the Securities and Exchange Commission. Once the BlockFi Yield registration statement is declared effective by the SEC, BIAs of U.S. clients will be exchanged for BlockFi Yield Accounts, unless clients instruct us otherwise. This exchange will not involve the sale of any client assets and should not be a taxable event.
How will the BlockFi Yield experience differ from the BlockFi Interest Account?
Because of rules relating to the SEC’s registration process, we generally cannot comment on details of BlockFi Yield that go beyond the releases we announced earlier today. But from a client’s perspective, the user experience of BlockFi Yield will be substantially similar to your experience with the BIA.
This communication does not constitute an offer to sell or the solicitation of an offer to buy BYs or BIAs, and shall not constitute an offer or sale in any jurisdiction in which such offer or sale would be prohibited. Any offers, solicitations or offers to buy, or any sales of securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended (“Securities Act”). We have not yet filed or confidentially submitted a registration statement with the SEC and there can be no assurance that such a registration statement will be filed and declared effective.
The BIAs have not been registered under the Securities Act of 1933, as amended, and may not be offered or sold in the United States, to U.S. persons, for the account or benefit of a U.S. person or in any jurisdiction in which such offer would be prohibited.
This communication contains “forward-looking statements”. which involve risks and uncertainties. You should not place undue reliance on forward-looking statements because they are subject factors which are difficult to predict. These forward-looking statements are generally identified by the use of “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “target,” “will,” “would” and similar expressions. Risks and uncertainties include, but are not limited to: anticipated trends and challenges in our business and the crypto ecosystem; our ability to comply with the terms and undertakings in the SEC and state settlements discussed above; and our ability to register the BYs with security regulators. We do not undertake to update any forward-looking statement as a result of new information or future events or developments.