- SoFi ending cryptocurrency services by December 19, offers account transfer or liquidation.
- Blockchain.com migration offers enhanced features but faces state-specific restrictions and tax implications.
- SoFi’s regulatory compliance with OCC influenced its crypto business withdrawal decision.
SoFi Technologies, known as SOFI, has announced that it will discontinue its cryptocurrency services by December 19. Customers currently using SoFi’s crypto services will be presented with two options: they can either transfer their accounts to the Blockchain.com platform or have their accounts closed and the funds liquidated, subject to certain conditions.
SoFi’s crypto customers have received an email detailing the process of transferring their accounts to Blockchain.com. Customers who prefer to shift their accounts to Blockchain.com must actively choose to do so. This transfer will offer enhanced features for these crypto accounts. Benefits include access to a wider range of tokens, improved trading capabilities, and stronger security features, such as the option for users to have self-custody of their cryptocurrencies.
Moreover, SoFi customers who prefer to close their cryptocurrency accounts have the option to initiate this process themselves before December 19. After this date, any remaining active crypto accounts will be automatically liquidated and closed by SoFi. Account holders will be informed of the transaction details via email and should expect to receive the proceeds in their brokerage accounts within a period of 60 days.
The entire account migration and closure process is scheduled to be finalized by 11 p.m. However, a significant consideration for users is the potential tax implications associated with liquidating their crypto holdings. Profits made from these sales may be subject to capital gains tax.
Meanwhile, Blockchain.com, the designated platform for migrating SoFi’s crypto accounts, does not offer its services in every U.S. state. Consequently, there are restrictions on certain tokens and their migration to Blockchain.com, depending on the state.
For customers in Virginia, Hawaii, Louisiana, New Jersey, Nevada, Tennessee, and Texas, cryptocurrency services will be provided through a partnership with Bakkt Crypto Solutions. Customers in these states will need to accept Bakkt’s terms and conditions to continue receiving services.
Additionally, specific tokens like Aave, Stellar, Uniswap, and Polkadot will be automatically sold during the account migration process on December 19 for customers in the aforementioned states.
For users in New York, the situation is different. They are not eligible for the migration to Blockchain.com. Their accounts will remain active until January 28. Until December 19, trading will continue as usual. Between December 19 and January 28, these accounts will be restricted to selling cryptocurrencies only, without the option to buy. After January 28, similar to other states, these accounts will be closed and liquidated following the same procedure.
The decision by SoFi to withdraw from the cryptocurrency sector has been in development for approximately two years. This strategic move aligns with the company’s broader objectives and regulatory requirements. In January 2022, SoFi received conditional approval from the Office of the Comptroller of the Currency (OCC) to function as a bank holding company.
“The Bank Holding Company Act permits us to continue our current digital assets related offering for a two-year conformance period from the date we became a bank holding company.”
SoFi Technologies
A key stipulation of this approval was that SoFi would abstain from engaging in any cryptocurrency-related activities or services without receiving explicit approval from the OCC. This condition was clearly outlined in a filing made by the company in September 2022, reflecting the regulatory framework they agreed to adhere to in their transition to a bank holding company.
