Cumberland stops Filecoin after SEC warning

Blenda Rosen
Blenda Rosen Crypto Currency
2 Min Read

Cumberland decided to stop trading Filecoin. This decision was taken after the warning SEC issued in recent weeks regarding Filecoin not meeting the criteria for an investment contract.

Many companies are forced to take a step back due to the lack of clarity The US Securities and Exchange Commission’s (SEC) provided. It appears that the recent crackdown on cryptocurrencies also contributed to this. Cumberland customers received a warning on Tuesday stating that the company would stop trading the token used by the decentralized storage platform Filecoin with its OTC counterparts.

According to The Block the firm said that all FIL transactions executed before 18:00 on June 1 will be executed in accordance with the normal processes under the Master Purchase Agreement.

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The company has turned its finger to the SEC

The statement of the company officials includes facts such as why they had to stop over-the-counter trading as a precautionary measure due to the “regulatory environment”. There has been no further comment on the matter for now.

Cumberland’s specific concerns regarding Filecoin transactions have yet to be disclosed. However the move comes at a time of heightened regulatory scrutiny on cryptocurrency market participants in the US and the withdrawal of some of the firm’s competitors.

SEC warns Grayscale on Filecoin

World’s largest digital investment company Grayscale Investments recently announced that the US Securities and Exchange Commission (SEC) has requested that the company withdraw its application for the Filecoin product. This request was said to have been made because the SEC concluded that Filecoin did not meet the criteria to be classified as an investment contract.

Grayscale’s response to the SEC’s warning was to state that FIL cannot be characterized as an investment contract.

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Blenda Rosen
By Blenda Rosen Financial Writer
Hi there! My name is Blenda, and I'm a Personal Finance and Markets Reporter at California/USA Today. I graduated from San Jose State University with degrees in Business Administration and International Business, and I'm a Certified Public Accountant (CPA) in California. My passion is creating personal finance content that resonates with my readers. I know from experience how daunting managing personal finances can be, and I aim to provide actionable advice that people can use to improve their financial situations. Whether it's budgeting, saving, investing, or retirement planning, I'm here to help my readers make informed decisions about their money. As a financial journalist, I'm always seeking to expand my knowledge and skills in the field. I'm particularly interested in areas like venture capital, startups, fintech, payment methods, and international banking. I believe that staying up-to-date on the latest developments in the industry is crucial to providing valuable insights to my readers.
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