National Bank reveals illegal cryptocurrency loans of BitCapital service
5 February 11:55
The National Bank of Ukraine has exposed an attempt to circumvent financial legislation that poses a real threat to financial security and consumer rights. Thus, the online service BitCapital has created an illegal scheme for lending money, disguising its activities as operations with crypto assets. This is stated in the message of the NBU, Komersant ukrainskyi informs.
“The National Bank has received hundreds of appeals from citizens who have suffered from the activities of this company. An in-depth analysis showed that the BitCapital online service has built a complex mechanism for circumventing the law: formally providing loans in USDT, they actually issue loans in hryvnia, bypassing all regulatory mechanisms established by law,” the National Bank said.
Therefore, after analyzing BitCapital’s activities, the NBU decided to recognize the presence of signs of a financial service for lending funds in the transactions concluded on this online service, which is a violation of the Law of Ukraine “On Financial Services and Financial Companies.”
In addition, the company is prohibited from carrying out such activities in Ukraine until it has duly complied with all the requirements of the legislation on financial market activities (without any manipulations or disguising the economic essence of the service).
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The National Bank has identified systemic violations of the law:
- exceeding the maximum permissible interest rates,
- manipulations with the disclosure of information about the real cost of a loan,
- misleading consumers about the terms of the contract.
“All of this took place against the backdrop of complete non-transparency regarding the terms of service and deliberate evasion of regulatory requirements. The most vulnerable segments of the population suffered as a result of participating in this scheme, and military personnel faced outright discrimination: they were unreasonably denied the benefits provided by law and aggressive methods of debt collection were applied to them,” the NBU also said.
They reminded that the legal framework of Ukraine clearly regulates financial services and defines the hryvnia as the only legal tender.
The NBU has forwarded all the materials to the National Police of Ukraine and the Bureau of Economic Security with a request to take all necessary measures to stop the illegal activities of the BitCapital online service.
“Moreover, we have identified a number of financial institutions that have cooperated with this service in one way or another. We are currently preparing a response that will warn any player from the legal financial field against such a “partnership,” the National Bank summarized.
