BitGo reaches truce with OFAC
2 min readTL;DR Breakdown
- BitGo pays over $90,000 fine to OFAC.
- Talks between the crypto firm and PayPal have broken down.
BitGo has been able to settle with a regulatory body in charge of financial intelligence and enforcement in the United States, Office of Foreign Assets Control (OFAC). The body had imposed an enforcement action against the crypto firm because it was unable to prevent users in certain countries like Crimea, Cuba, Iran, Sudan, and Syria from making use of its services.
According to the authorities, the crypto firm had offered its services to these people between March 10, 2015, and December 11, 2019. The users had made use of the company’s non-custodial secure digital wallet management service between that period to carry out over 100 transactions that were worth around $9,000.
A recent announcement by the US authorities showed that BitGo has agreed to pay a fine of $98,830 for the infraction. Usually, the penalty for violations like this could be as high as $53 million but OFAC notes that the crypto firm cooperated with the investigation.
Jake Chervinsky, who is the General Counsel at Compound Finance, hailed the settlement as a “pretty” thing for the crypto firm. He said this was so when one considers the fact that the disclosure was involuntary.
Jake added that it appears that the authorities do not need more Know-your-customer (KYC) processes before they enforce such sanctions against any erring crypto firm.
BitGo and PayPal acquisition talk breaks down
Earlier in October, rumors were rife that PayPal was going to be purchasing BitGo, this would no longer be possible as we recently reported that the crypto firm CEO, Mike Belshe, has said that his firm is not looking to raise any external funding presently.
Belshe had also added that the firm’s balance sheet is currently healthy though the firm is not profitable yet.
PayPal, however, has been on the lookout for an alternative crypto firm to purchase.
