US Securities and Exchange Commission (SEC) charged cryptocurrency exchange Bittrex and its former CEO William Shihara in promoting and selling unlisted securities. The SEC did not like trading in OMG, DASH, ALGO, TKN, NGC and IHT tokens.
“Since at least 2014, Bittrex has positioned itself as a platform that facilitates the buying and selling of crypto-currency assets that are offered and traded as securities. From 2017 to 2022, Bittrex generated at least $1.3 billion in revenue, specifically through transaction fees from investors, including US investors, whom Bittrex served as a broker, exchange, and clearing agency. But none of these areas of activity was registered with the Securities and Exchange Commission, ”the regulator said in a statement published on the official website.
Today we charged crypto asset trading platform Bittrex Inc. and its co-founder and former CEO William Shihara for operating an unregistered national securities exchange, broker, and clearing agency.https://t.co/kBsIFMP7ZA
— US Securities and Exchange Commission (@SECGov) April 17, 2023
The head of the SEC, Gary Gensler, believes that the crypto exchange was aware of all the rules, but “made every effort to get around them.”
In early April, Bittrex made the decision to stop operating in the US. The reason was “regulatory uncertainty”. Customer funds from America were not affected, but had to be withdrawn by April 30th.
Bittrex co-founder and CEO Richie Lai explained that it is “not economically viable” to keep the exchange operating in the US under the current conditions. He also said that US regulators are not in contact with representatives of the cryptocurrency market.
The marketplace has already been hit by regulators — the Office of Foreign Assets Control (OFAC) and the Financial Crime Enforcement Network (FinCEN) forced Bittrex to pay $29 million in fines for “apparent violations” of the sanctions policy against Iran, Cuba and Syria.
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