Crypto lending firm Abra, allegedly insolvent since March 2023, entered a settlement in principle with the Texas State Securities Board. The company will return assets invested by the state’s citizens.
On Jan. 22, the Texas State Securities Board released the final confirmation of the settlement. According to it, Abra “began winding down U.S. retail operations” and will now notify clients with more than $10 balances so they can withdraw their assets in seven days. The unclaimed assets will be converted to fiat currency and directed to remaining Texas investors.
Abra is a group of companies controlled by crypto entrepreneur Bill Barhydt. The settlements name four separate entities tied to the brand: Plutus Financial Holdings Inc., Plutus Financial Inc., Plutus Lending LLC, and Abra Boost LLC.
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The brand has been offering Abra Earn and Abra Boost. Users were promised interest on their digital asset deposits, while the company earned profits from lending these funds. One can still find such an offer on the Abra website, claiming that up to 10% of interest is compounded daily and paid out every Monday.
On June 15, the Texas State Securities Board issued an emergency cease and desist order, accusing Barhydt and Abra of committing securities fraud as well as engaging in deception regarding the sale of investment products. The state regulator has also claimed that the firm was insolvent, or nearly insolvent, as of March 31.
According to the settlement text, by the time Texas filed actions, Abra held $13.6 million of crypto on behalf of more than 12,000 U.S. investors. Only $1.8 million of them were owned by approximately 1,600 Texas residents.
The company’s X (former Twitter) account has been silent since June 2023. Bill Barhydt confirmed the settlement, emphasizing that Abra “has never (ever) frozen withdrawals for US users” and “voluntarily wound down” the Earn and Boost programs in 2023.
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