Celsius Network, an online cryptocurrency lender, attracted more than a million users with promises of sky-high returns — until a market crash over the summer plunged the startup into bankruptcy and put members’ money at risk.
The company said it was the victim of extreme market conditions. But a bombshell court filing last week detailed evidence that Celsius had been misleading investors for years in a Ponzi-like scheme.
The source of those explosive allegations: the Vermont Department of Financial Regulation.
Vermont is by no means a crypto epicenter, but over the last few years, regulators in the obscure state agency have quietly been probing similar companies for securities compliance issues that federal regulators have been slow to take up. DFR’s first investigation led to a trailblazing $100 million national settlement earlier this year with a crypto lending company called BlockFi. Now, the agency is at the forefront of a multistate probe into Celsius, whose alleged mismanagement has ensnared…
