(Bloomberg) -- SoFi Technologies Inc., the fast growing one-stop shop for financial-services products, is exiting crypto even with token prices surging because of increased scrutiny of the sector by banking regulators.

The San Francisco-based company told crypto customers Wednesday they will need to liquidate their accounts in coming weeks, or move to crypto exchange and wallet provider Blockchain.com.

SoFi, which was started 12 years ago as a student-lending refinancing company, has since expanded into a slew of other services and received a bank charter in January 2022. The approval of the charter was conditional on a two-year conformance period for its crypto business: The company either had to receive necessary regulatory approvals for it or to exit the digital asset sector. 

In August, the Federal Reserve said it’s stepping up scrutiny of lenders’ involvement in digital assets. The Fed, Federal Deposit Insurance Corp. and the Office of the Comptroller of the Currency in January detailed concerns with the volatile asset class. Watchdogs also denied a crypto firm’s application to become a member of the Fed. Metropolitan Commercial Bank exited the sector in January.

SoFi, which initially waded into crypto in 2019, was a high-profile participant in the sector, even hosting an event at Bitcoin Miami last year. But crypto has been a non-material part of its business, with brokerage-related fees — which include all crypto-related fees — reaching about $6 million in the three months ended Sept. 30, according to SoFi’s financial statements. Digital assets held totaled $139.4 million as of Sept. 30. SoFi is expected to report $2 billion in revenue this year, according forecasts compiled by Bloomberg.

As of Wednesday, SoFi customers will no longer be able to open new crypto accounts. Existing members will have to migrate their crypto holdings over to Blockchain.com by Dec. 19, or their remaining balances will be liquidated. 

Terms of the agreement with Blockchain.com were not disclosed. Next year, SoFi will also start referring its members to other crypto partners.

Around since 2011, Blockchain.com operates a crypto exchange as well as one of the most popular wallets for holding cryptocurrencies. It’s created 87 million wallets, and a third of Bitcoin network transactions are via Blockchain.com, according to its website. The company previously disclosed exposure to the collapse of the Three Arrows Capital hedge fund; it’s also laid off staff.

But more recently, as interest in crypto began to return, Blockchain.com has closed a $110 million round of funding led by UK-based Kingsway Capital.   

--With assistance from Hannah Miller.

©2023 Bloomberg L.P.