SoFi, an online lender and financial services company, announced on Wednesday that it would be exiting its cryptocurrency business due to increased regulatory scrutiny. SoFi launched its crypto trading service in August 2019 and since then had seen robust growth, but it appears the company has decided that the regulatory risk associated with cryptocurrencies outweighed the benefits.
SoFi CEO Anthony Noto said in a statement: “We have decided to discontinue SoFi Invest Crypto due to market conditions and additional factors that have made digital asset trading more difficult, both from a technology perspective, as well as a regulatory perspective. While we believe that crypto may have a place in the SoFi Invest platform in the future, we are taking a step back from the asset class at this time.”
SoFi’s exit from the crypto business comes at a time when regulatory bodies around the world are increasingly taking a closer look at cryptocurrency trading activities. The U.S. Securities and Exchange Commission (SEC) has been investigating a number of platforms for potential violations of its regulations and the Financial Industry Regulatory Authority (FINRA) has stepped up its oversight of cryptocurrency brokers. In light of this heightened regulatory scrutiny, it appears that SoFi has decided to exit the crypto business for the time being.
