As a researcher with a background in financial markets and cryptocurrencies, I find the recent news about Abra’s acquisition of several private cryptocurrency trusts from Valkyrie Investments intriguing. The expansion of Abra’s offerings through this acquisition seems like a strategic move to broaden their existing range of services for new clients. However, I cannot help but be concerned about the regulatory issues that have plagued Abra in the past.
As a financial analyst, I can share that in May 2024, Abra, the crypto trading platform, announced its acquisition of several private cryptocurrency trusts from Valkyrie Investments.
Based on Bloomberg’s article, Abra Capital Management LP has assumed control over Valkyrie’s Trusts for Tron and Zilliqa, along with some other unspecified digital asset trusts. The Zilliqa Trust had offloaded assets worth $21.3 million, while theTron Trust had disposed of assets amounting to $50 million.
Marissa Kim, the head of asset management at Abra, confirmed in an interview that the company had made a new acquisition. This deal, she explained, would broaden Abra’s current offerings of spot and DeFi solutions for potential clients. It’s possible that Abra may choose to make some of these trusts available for public trading based on market interest.
According to the report, Abra reached an agreement with financial authorities from 25 American states over unauthorized crypto operations. Under the terms of the accord, Abra is required to refund approximately $82.1 million in cryptocurrencies to US clients. Notably, Abra had ceased its services within the United States last year prior to this settlement.
CSBS, the Conference of State Bank Supervisors, declared that Abra will cease accepting cryptocurrencies from US clients for their Abra Trade accounts and will suspend all buying and trading activities. Regulators in Washington, Texas, Georgia, and Ohio chose not to levy fines to guarantee full refunds for affected customers.
In the year 2023, the Texas State Securities Board brought accusations against Abra for insolvency and securities fraud. They claimed that Abra deceived investors by selling two crypto interest account products. As a result, the board issued a cease order against the exchange. Abra reached an agreement with Texas regulators in January 2024, pledging to shut down its operations and refund investments to affected parties.
Bill Barhydt, founder of Abra, emphasized that the platform never imposed limitations on US withdrawals and intends to discontinue its retail operations within the United States. Leah Wald, a Valkyrie co-founder and previous CEO, recently stepped down from the company. Valkyrie has yet to provide a statement regarding the sale of their crypto trusts to Abra.
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2024-07-13 07:01