Maine is getting about $30,000 from a Florida-based cryptocurrency company that violated state laws by offering Maine investors an unregistered interest-earning program.

Maine’s payout is part of a $3 million settlement between TradeStation Crypto Inc., the Securities and Exchange Commission, and 26 states. Maine’s investors all were able to recover their money with interest and the $30,000 from the settlement will go into the state’s Securities Restitution Assistance Fund, which provides assistance to people who have lost money because of securities violations.

In addition to feeding the fund, the Maine Office of Securities wants to send a warning to other companies about the consequences they face if they violate state securities laws.

“Our goal is to ensure that companies are complying with the securities laws. And to ensure that customers and investors are fully informed about the risks of these investments so that we can hopefully prevent any future instances of Maine residents losing money they worked their entire lives to save up,” Maine Securities Administrator Jesse Devine said.

TradeStation Crypto formed as an arm of an eponymous online brokerage in 2018 that offers trading programs for cryptocurrency, a digital form of currency such as Bitcoin. In 2020, TradeStation began offering 29 Maine investors access to an interest-earning program that generated revenue by lending firm- and customer-owned crypto assets, according to the settlement. Maine investors saw advertisements that they could earn up to 6% interest on their investments.

TradeStation shut the interest feature down in 2022. At that point, Maine investors had opened 36 accounts with TradeStation Crypto collectively valued at $135,353. At its height, there were around 11,000 customers nationwide investing $281 million in TradeStation’s interest feature.


But in those two years, TradeStation did not register the interest-earning investment program with the SEC, violating federal and Maine laws.

TradeStation has agreed to pay $1.5 million to the SEC and another $1.5 million to 26 states that have so far signed on. Maine joined that settlement in January. TradeStation has since paid the state $29,412. TradeStation has also agreed to never offer an interest-earning program again.

But that money won’t go to TradeStation’s Maine investors, who were all able to recover their money, Devine said. That’s because TradeStation remained open after shutting down its interest-earning program, unlike other cryptocurrency companies that have gone bankrupt. Crypto-trading company BlockFi settled with Maine in 2022 and paid $943,396 for not registering with the SEC and overstating the extent of its collateral offerings, which serve as a safety net for investors when a company defaults. BlockFi declared bankruptcy four months later and has been unable to repay Maine investors, Devine said.

The money from TradeStation will go directly to the Securities Restitution Assistance Fund to provide partial restitution to people like the BlockFi investors who have suffered monetary injuries from securities violations and aren’t able to recover their money.

“Although no TradeStation investor lost money in this case, investors in similar cryptocurrency interest accounts with other companies have lost large amounts of money. In many tragic circumstances, some have lost their entire life savings,” Devine said. “The assistance fund is a vehicle for the Office of Securities to help Maine victims of securities-laws violations recover what they’ve lost. The payments that TradeStation made as part of this settlement is in furtherance of that more general goal.”

TradeStation did not respond Tuesday to requests for comment.

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