January 29, 2018 11:43 PM
Is everything bigger in Texas? That might not be the case for AriseBank’s customer base. The purported cryptocurrency bank has found itself in hot water with the state’s banking commissioner.
Effective January 26, 2018, a cease and desist order, put forth by Texas Banking Commissioner Charles G. Cooper, names AriseBank in violation of Texas Finance Code 31.005(a).
Issues arose between the Lone Star State and AriseBank earlier this January, when Cooper originally issued the order. According to Cooper, AriseBank was in violation of Chapter 31 by using the term “bank” in its name, suggesting that the company provides banking services in the state of Texas.
As per the company’s social media feed, AriseBank is self-described as a decentralized peer-to-peer transaction-based platform, integrating cryptocurrencies and allowing users to act as their own banks. On January 25, the company issued a press release indicating that, due to its decentralized nature, the platform need not seek the auspices of the Federal Deposit Insurance Corporation; however, this seems to have had little effect on the decision of the Texas banking commissioner.
Documents filed by the commissioner indicate that although AriseBank advertised itself as providing banking services in Dallas, Texas; Dubai, AE; and Zug, Switzerland, it was not chartered, nor authorized under the supervision of any regulatory agency, to allow banking activity.
As per the order, AriseBank must abstain from the implication that it offers banking services in Texas, and provide disclosure that any banking services offered by the company are unavailable to Texas-based consumers.
By law, AriseBank had up to 20 days to provide a written request for a hearing to the banking commissioner and, having failed to do so, the original order from January 5 will be upheld as final and non-appealable.
Jeremy Nation is a writer living in Los Angeles with interests in technology, human rights, and cuisine. He is a full time staff writer for ETHNews and holds value in Ether.
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