Crypto lending startup Celsius is facing regulatory pressure in Texas in a sign of U.S. watchdogs’ growing scrutiny of the booming crypto lending industry.

On Friday, the Texas State Securities Board (TSSB) alleged Celsius’ interest-bearing crypto deposits are unregistered securities. It ordered the startup to appear before a hearing in February 2022 where a cease-and-desist order will be considered.

“We are accusing Celsius of selling these investments in Texas without first complying with important laws designed to protect investors,” TSSB Enforcement Director Joseph Rotunda told CoinDesk via email, adding:

The order is the latest in a string of U.S. regulatory actions against the biggest names in crypto lending.

Offering clients sky-high yields (compared to banks, at least) in return for staking their crypto, firms like BlockFi, Coinbase and now Celsius have drawn state and federal authorities’ ire.

Texas regulators privately informed Celsius of potential securities violations in May, according to the Friday filing. But Celsius continued to pitch its interest-bearing accounts to Texans, it said.

BlockFi received a similar TSSB warning in April and by July was facing its own cease-and-desist hearing. Rotunda said the Celsius case is “substantially similar” to BlockFi’s.

“Texas is aware that parties other than BlockFi and Celsius are promoting investments in interest-bearing cryptocurrency depository accounts,” Rotunda told CoinDesk.

The order comes days after BlockFi CEO Zac Prince asserted that crypto lenders need federal guidance on the status of their products. He said the piecemeal efforts launched by states alone will not be enough for the industry to flourish.

“We’re not going to decide what box crypto lending belongs in based on what New Jersey does or what Texas does or what any one other state does,” Prince told New York’s SALT conference on Monday.

A request for comment sent to Celsius was not returned by press time.

Zack Seward contributed reporting.

UPDATE (Sept. 17, 15:51 UTC): Adds background and further comments from the Texas State Securities Board.

UPDATE (Sept. 17, 17:48 UTC): New Jersey has joined the list of enforcement actions, filing a cease-and-desist against Celsius.