ccn.com

Bitcoin is still dropping (down $602 at this moment).

New Jersey’s Attorney General says the online bitcoin investment platform has been fraudulently selling unregistered securities in the state. The New Jersey Bureau of Securities, a division of AG Gurbir S. Grewal’s office, has sent a cease-and-desist letter to Bitstrade, effective immediately, alleging that the company is in violation of the State’s Uniform Securities Law for pooling investments and promising returns of 10%, accruing daily. Bitstrade takes payments in bitcoin.

The Bureau’s response comes in the wake of a meeting among federal lawmakers to discuss the crafting of a regulatory framework for cryptocurrencies. Meanwhile, AG Grewal said the Bureau is looking to “protect investors as they navigate the uncharted and largely unregulated domain of cryptocurrency-related investments.”

“Bitstrade is a prime example of a company seeking to capitalize on the cryptocurrency craze. Regulators, including the Bureau, are actively responding to fraudulent crypto-cloaked securities offerings,” said Bureau chief Christopher W. Gerold in the statement.

The state’s approach has the hallmarks of similar action taken by Texas regulators against Bitconnect, leading to a series of events that led the bitcoin investment platform to shut its doors, which doesn’t bode well for Bitstrade.

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