Reuters - On Monday two cryptocurrency lending platforms were to be asked by the state attorney general to cease operations in New York and three other platforms were asked to send information about their business.
The move comes weeks after New York Attorney General Letitia James won a court order forcing the closure of blockchain exchange Coinseed.
In a redacted version of a letter sent Monday, James said the Office of the Attorney General was in possession of evidence of unlawfully selling or offering for sale securities and/or commodities Regulators in the U.S. have been ratcheting up scrutiny of a world that has so far existed in a regulatory gray area, against the backdrop of rising tension between the crypto industry and regulators worldwide.
James filed a lawsuit against Coinseed in February for allegedly defrauding thousands of investors with 'intimidation' being charged by charging hidden trading fees and selling worthless digital tokens.
The state attorney general warned investors about extreme risk when investing in virtual currency and issued warnings to those facilitating trading of cryptocurrency.
Cryptocurrency platforms must follow the law, just like everyone else, which is why James is now directing two crypto companies to shut down and forcing three more to answer questions immediately, said on Monday.