The US Securities and Exchange Commission (SEC) has indicted crypto exchange Bittrex and its co-founderfor not registering as a national stock market.
The SEC noted that the exchange’s foreign affiliate, Bittrex Global GmbH, was also charged because it has a single shared order book with the US-based company.
In an April 17 statement, the financial regulator alleged that Bittrex earned more than $1.3 billion in revenue from US investors while serving them as a broker, exchange, and clearing agency without registering with authorities.
According to the SEC, Bittrex and Shihara coordinated with crypto asset issuers to remove “problematic statements” that could cause regulators to investigate the crypto asset as a security offering.
“Bittrex and Shihara instructed issuer-applicants to remove statements related to ‘price prediction[s]’, ‘earnings expectation’ and other ‘investment-related terms’”.
The SEC complaints further alleged that Bittrex should “have registered as a clearing agency because it acted as an intermediary in making payments and deliveries by matching buy and sell orders and held custody of client assets.”
SEC Chairman Gary Gensler:
“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 ‘clear’ by offering disclosure materials indicating that certain crypto assets were securities. 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.”
Meanwhile, on March 31de Bittrex’ showed that it would suspend its operations in the US before April 30. The crypto company blamed the decision” on “continued regulatory uncertainty” in the country.
Since 2020, the exchange’s trading volume has declined to $12 million a day, from almost half a billion, according to Kaiko..
Bittrex is thethe financial regulator would file charges against him in the last three weeks. The SEC has recently increased its regulatory scrutiny of the crypto space, filing against crypto entrepreneur Justin Sun and several others.
The chargefirst appeared in .