The Brazilian Securities Commission (CVM) has sent a subpoena to Mercado Bitcoin, one of the country’s largest exchanges, asking about the company’s lending services with respect to cryptocurrency-related fixed-return investments. The company must disclose the details of these investments and whether it plans to keep them available to the public.
Mercado Bitcoin was subpoenaed
regarding fixtured income token investments.
Cryptocurrency exchanges are becoming less and less alone, with some offering bank-like products to get customers into the crypto market in areas of the country with high inflation rates, like Latam. Mercado Bitcoin, one of the largest cryptocurrency exchanges in Brazil, wassubpoenaedby the Brazilian Securities Commission (CVM) for the services it offers its customers through its platform.
The subpoena asks about the services offered through the token section on Mercado Bitcoin’s webpage, which, according to the CVM, offers customers a low-risk way to diversify their portfolios and receive higher yields in different areas The company said.
These tokens are available to customers with a certain number of stable coins and ostensibly offer higher yields than regular savings products in the short term.
CVM subpoena details
CVM is requesting certain key information about how these tokens work; Mercado Bitcoin will be required to provide the number of customers who have invested in these products since January 2020 and their identity in detail. In addition, Mercado Bitcoin must announce whether it intends to continue offering these token products in the future. If so, the company could be sanctioned if the CVM determines that such products are fraudulent.
Mercado Bitcoin, however, has assured that it does not offer unauthorized services. In a statement, the company explained.
We do not conduct public offerings of securities outside of the authorization we have as an accredited crowdfunding and investment advisory platform.
Similarly, the company clarified that it takes the utmost care not to infringe on the sphere of activity of authorized businesses and that it consulted on the structure of these tokens before offering the 2020 product.
This is the latest issue the exchange has faced this year, with the company running two different rounds of layoffs, the first in June and the second earlier this month.In 2021, Mercado Bitcoin raised $200 million in a Series B funding round backed by SoftBank and and achieved a valuation of over $2 billion.
Image credits: Shutterstock, Pixabay, Wiki Commons