An urgent cease and desist injunction was issued to Abra and its CEO William Barhydt. This prompted many investors to question whether Abra was bankrupt and why.
Everyone’s Talking About It: Is Abra Bankrupt? – 2023
Crypto lending firm Abra, which once handled more than $116 million in assets, had allegedly committed securities fraud and has been insolvent since March 31, according to Texas regulators.
Charges by the Texas State Securities Board
The Texas State Securities Board charged Abra and its founder William Barhydt with securities fraud as well as engaging in deception regarding the sale of investment products through its affiliates Abra Earn and Abra Boost in an enforcement action on June 15 that included an emergency cease and desist order.
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
Abra Made a Statement
On the other hand, Abra declared that it would be significantly revamping its operations in the near future. The business alerted US-based individual investors that it would be ceasing operations on June 15. The timetable for removing digital assets from Abra Trade will be communicated to current clients of the company.
Moreover, all jurisdictions, including the US, will continue to offer Institutional and Prime services. All this was reminiscent of Abra’s tweets on March 11.
Alleged $119 million in Assets Transferred to Binance
Other important information was included in the official notification that was delivered to Abra. According to the paper, Plutus Financial kept Abra Trade accounts in Fireblocks. The combined asset value of Abra Trade and Plutus Lending in Fireblocks, however, was just $43.79 million as of February 2023.
Moreover, the text claimed that Abra Trade and Plutus Lending secretly transferred their assets to Binance Holdings, aka Binance.com. As of February 2023, Abra Trade and Plutus Lending’s assets on Binance.com were valued at $118.58 million.
What is Abra?
The CEO, William Barhydt, launched the business in 2014, and its present headquarters are in Mountain View, California. Peer-to-peer (p2p) blockchain-based mobile payment services are offered by the technology and banking firm Abra. Bitcoin had previously been the primary digital currency for transaction processing before the company adopted Litecoin as the primary cryptocurrency for its services in 2018.
As a blockchain-based program, Abra mainly focuses on keeping track of monetary deposits made using the Abra wallet, which enables transfers of currency between two mobile devices. There are Abra apps for both iOS and Android that may be used for that.
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