Texas State Securities Board Takes Enforcement Action Against Crypto Firm Abra and CEO Bill Barhydt – What's Going On?
The Texas State Securities Board has issued an emergency cease-and-desist order against crypto lender Abra, claiming that it has been insolvent since at least March 31, 2023.
In a Thursday filing, the Texas regulator unveiled enforcement actions against Abra and its founder William Barhydt for allegedly committing securities fraud as well as engaging in deception regarding the sale of investment products through its affiliates Abra Earn and Abra Boost.
Abra "made offers of investments in Abra Earn in Texas containing statements that were materially misleading or otherwise likely to deceive the public," the filing said, making similar claims about other Abra products.
"The alleged misconduct includes the intentional concealment of financial information reflecting the capitalization of parties, defaults on loans, and the transfer of assets to Binance."
The regulator claimed that the company secretly transferred assets to Binance, which was sued last week by the US Securities and Exchange Commission and accused of running an unregistered crypto exchange.
It alleged that as of February 2023, Abra Trade and Respondent Plutus Lending had more than $118 million worth of digital assets held at Binance.
Moreover, the filing claimed that Abra had previously asserted that it would “cease selling investment in Abra Earn in October 2022,” which it failed to do.
In October, Abra and its affiliates “began offering and selling investments in Abra Boost, a digital asset depository account, to accredited and institutional investors in the United States.”
Founded in 2014, Abra is one of the oldest crypto lenders in the market with over $116 million of assets under management for Abra Earn and Abra Boost investors in the United States as of May
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