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The Brazilian Securities and Exchange Commission (CVM) has sent a subpoena to Mercado Bitcoin, one of the largest exchanges in the country, to inquire about the services the company lends regarding cryptocurrency-related fixed income investments. The company will have to disclose the details of these investments and whether it plans to maintain them publicly available.
Cryptocurrency exchanges are becoming more than just that, and in regions like Latam, where there are countries with high inflation rates, some are offering bank-like products to entice customers to enter the crypto market. Mercado Bitcoin, one of the largest cryptocurrency exchanges in Brazil, has been subpoenaed by the Brazilian Securities and Exchange Commission (CVM) over the services it offers clients through its platform.
The subpoena asks about the services offered through the Tokens section of the Mercado Bitcoin website, which, according to CVM, offers a way for customers to diversify their portfolio with supposedly low risk and receive high returns in different areas.
These tokens are available to customers with more than a certain number of stablecoins, and apparently offer higher returns than regular savings products in the short term.
CVM requires certain key information about how these tokens work. Mercado Bitcoin will have to state the number and identities of the customers who have invested in these products since January 2020. In addition, Mercado Bitcoin will have to announce whether they intend to continue offering these token products in the future. If it does, the company could face sanctions if the CVM determines that the products are irregular.
However, Mercado Bitcoin confirms that they do not offer irregular services. In a statement, the company explained:
We do not carry out a public offering of securities outside the scope of the authorizations we have as an authorized crowdfunding and investment management platform.
In the same way, the company clarified that it takes the utmost care not to violate the field of action of authorized entities and that the company had consulted on the structure of these tokens before the offering of the products in 2020.
This is just the latest problem the stock exchange has faced this year, with the company carrying out two different rounds of layoffs, the first in June and the latest carried out earlier this month. In 2021, Mercado Bitcoin raised $200 million in its Series B funding round, backed by Softbank, achieving a valuation of more than $2 billion.
What do you think of Mercado Bitcoin’s CVM subpoena? Tell us in the comments section below.
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