Digital Finance Firm SoFi Hands Its Crypto Business to Blockchain.com

5 views 4:02 pm 0 Comments November 29, 2023
  • SoFi is handing crypto customers to Blockchain.com, possibly tied to SoFi’s decision to become a bank.
  • In an interview, Blockchain.com President Lane Kassleman said the partnership equates to hundreds of thousands of users and millions of dollars.

SoFi Technologies (SOFI), an online bank and financial services company, is exiting the cryptocurrency business, telling customers they can transfer their digital assets to Blockchain.com’s platform or liquidate them.

The closure takes effect on Dec. 19, according to an email it sent customers Wednesday.

SoFi’s transition from directly offering crypto services may be tied to its decision to become a bank holding company. The U.S. Federal Reserve, as part of that approval, told the company that its crypto activities were not permissible under banking rules. However, it would be allowed to continue for two years, with the possibility of extensions, according to a regulatory filing. (Bloomberg reported on SoFi’s decision to close and the link to banking regulation earlier Wednesday.)

Blockchain.com President Lane Kassleman said SoFi still wants to offer crypto services to its customers, hence the Blockchain.com partnership.

“So you’ll still be able to link out to crypto products from the SoFi app,” Kassleman said in an interview on Wednesday. “You just won’t be able to access them within the SoFi domain. This is not dissimilar to how they offer insurance products, for example.”

Kassleman said the partnership equates to hundreds of thousands of users and millions of dollars. “It’s also not something that happened overnight. You can imagine the complexity of moving over all these users, so this partnership has been in preparation for over a year,” he said.

According to a regulatory filing, Crypto has been an intelligent part of SoFi’s business, with digital assets totaling $139.4 million as of Sept. 30.

The migration to Blockchain.com’s wallets will be facilitated for users in some U.S. states by crypto-focused broker-dealer Bakkt (BKKT), with which Blockchain.com has an agreement, Blockchain.com said in a blog post.