Following the report revealing that cryptocurrency exchange Bittrex had received a Wells Notice from the US Securities and Exchange Commission (SEC), the securities regulator indicted Bittrex and the company’s chief executive officer on Sept. 17. April for “operating an unregistered exchange, broker, and clearing agency.” ”
Following Wells’ Notice, SEC Accuses Bittrex of Violating Federal Laws
On Monday, the US Securities and Exchange Commission (SEC) charged another cryptocurrency exchange, accusing the Bittrex trading platform to operate “an unregistered national stock exchange, broker, and clearing agency.” Since 2014, Bittrex has allegedly sold crypto assets that were “offered and sold as securities.” The SEC’s complaint was filed in the US District Court for the Western District of Washington.
The SEC further alleged that Bittrex Global should have registered the exchange, and the regulator claims that the two entities took advantage of a “shared order book.” The complaint also notes that Bittrex should have registered as a clearing agency and broker. “(Bittrex) was regularly engaged in the business of transacting for the accounts of others in crypto assets that were offered and sold as securities,” the SEC complaint insists.
“Today we hold Bittrex accountable for its breach,” SEC Chairman Gary Gensler wrote in a statement on Monday. “Today’s action once again makes it clear that crypto markets suffer from a lack of regulatory compliance, not a lack of regulatory clarity. “As alleged in our complaint, Bittrex and the issuers it worked with were aware of the rules that applied to them, but went to great lengths to evade them by ordering issuer-applicants to ‘delete’ by offering informational materials indicating that certain crypto assets were securities. ”
The SEC chairman added:
Furthermore, Bittrex, as alleged, did not register or comply with US securities laws as an exchange, broker-dealer, and clearing agency. The cosmetic alterations did nothing to change the underlying economic realities of Bittrex’s offerings and conduct.
He SEC complaint follows recent news that Bittrex received a notice from Wells informing the cryptocurrency exchange of possible enforcement action. Bittrex general counsel David Maria told the Wall Street Journal that if the SEC decided to sue the company, the exchange would challenge the action in court unless the regulator “made a reasonable settlement offer.” As of this writing, the SEC’s lawsuit offers no settlement, and the court docket says “a jury trial is required.” In addition to cryptocurrency exchange Bittrex Global, the company’s chief executive officer, William Hiroaki Shihara, is also named in the case.
What do you think about the latest SEC enforcement action against Bittrex and do you think it will lead to more regulatory scrutiny in the cryptocurrency industry? Share your thoughts in the comments section below.
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