Texas State Securities Board (TSSB) and Abra, a cryptocurrency lending company purportedly insolvent since March 2023, have reached a preliminary settlement. The organization shall reimburse funds contributed by residents of the state.
The TSSB issued the final confirmation of the settlement on January 22. As per the document, Abra has initiated the process of “winding down retail operations in the United States” and will provide seven days’ notice to clients whose balances exceed $10, allowing them to withdraw their assets. The remaining Texas investors will receive the fiat currency conversion of the unclaimed assets.
An organization known as crypto entrepreneur Bill Barhydt supervises Abra. The settlements designate Plutus Financial Holdings, Plutus Financial, Plutus Lending, and Abra Boost as the four distinct entities associated with the brand.
By means of Abra Earn and Abra Boost, the brand has been providing users with the assurance of interest on their deposits of digital assets while the company generates revenue by lending the funds. The offer persists on the Abra website, asserting that daily compounding of up to 10% of interest will result in a payment on Monday.
The TSSB issued an emergency cease and desist order against Barhydt and Abra on June 15, 2023, alleging that they were involved in securities fraud and deceit concerning the sale of investment products. Additionally, the state regulator asserts that the company was either insolvent or on the verge of insolvency on March 31, 2023.
As per the settlement text, Abra possessed $13.6 million worth of cryptocurrency on behalf of over 12,000 investors in the United States when the TSSB initiated legal proceedings. A mere $1.8 million of these were under the ownership of an estimated 1,600 residents of Texas.
Since June 2023, the organization’s X (previously Twitter) account has remained inactive. Regarding the settlement, Bill Barhydt affirmed that Abra “never has (ever) frozen withdrawals for US users” and that the Earn and Boost initiatives were “voluntarily wound down” in 2023.
