Texas regulators issue order against company soliciting Bitcoin investments

Source: Austin American-Statesman

In what is thought to be the first Bitcoin-related order issued by a state securities regulator nationwide, the Texas State Securities Board on Monday issued a cease and desist order to a Southlake oil-and-gas company that said it was accepting the digital currency from investors.

While the bulk of the order focused on traditional securities fraud claims, it also noted that the company, Balanced Energy LLC, failed to disclose information about “the nature of risks associated with the use of Bitcoin.”

The risks include those “inherent to the use of Bitcoin and the risk that fluctuation in the price of the digital currency may affect business operations,” according to the order, which the agency released publicly on Tuesday.

“I know our members are starting to look at (digital currencies) from a regulatory perspective, but I’m not aware of any enforcement actions taken by a state securities regulator prior to the action in Texas,” said Bob Webster, spokesman for the North American Securities Administrators Association.





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