The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against Bittrex, a cryptocurrency exchange, and its former CEO, Bill Shihara, for allegedly violating federal statutes. The regulator claims that Bittrex operated as a national securities exchange, broker, and clearing agency simultaneously, without registering as any of the three entities. Bittrex also worked with crypto issuers to remove “problematic statements” that the SEC would investigate, including price predictions and statements implying an “expectation of profit.” The SEC alleges that Bittrex should have registered as an exchange, clearing agency, and broker, as it provided the services of all three.
Bittrex announced last month that it planned to exit the U.S. by the end of April, citing “the current U.S. regulatory and economic environment.” However, the company’s general counsel, David Maria, revealed to the Wall Street Journal over the weekend that the company received a Wells Notice in March. A Wells Notice is a statement that the SEC’s Enforcement Division has found evidence of legal violations. The SEC’s lawsuit against Bittrex is similar to a recent action against Beaxy, a company that settled similar charges. It also suggests the charges that the SEC may bring against Coinbase, the U.S.’s largest exchange, which received a Wells Notice last month.
According to the SEC’s complaint, Bittrex worked with crypto issuers to remove statements that could be problematic for the exchange. The regulator claims that these statements included price predictions and statements implying an “expectation of profit.” The SEC alleges that Bittrex should have registered as an exchange, clearing agency, and broker, as it provided the services of all three. Bittrex’s alleged violations are similar to those of Beaxy, which settled charges with the SEC in February.
Bittrex announced last month that it was planning to exit the U.S. market by the end of April, citing the “current U.S. regulatory and economic environment.” However, the company’s general counsel, David Maria, revealed to the Wall Street Journal over the weekend that the company received a Wells Notice in March. A Wells Notice is a statement that the SEC’s Enforcement Division has found evidence of legal violations. The SEC’s lawsuit against Bittrex is similar to a recent action against Beaxy, a company that settled similar charges. It also suggests the charges that the SEC may bring against Coinbase, the U.S.’s largest exchange, which received a Wells Notice last month.
The SEC’s complaint alleges that Bittrex allowed the trading of six cryptocurrencies that are securities. These cryptocurrencies are omise go (OMG), algorand (ALGO), dash (DASH), monolith (TKN), i-house token (IHT), and naga (NGC). The SEC alleges that Bittrex should have registered as an exchange, clearing agency, and broker, as it provided the services of all three. The regulator claims that Bittrex worked with crypto issuers to remove statements that could be problematic for the exchange. The SEC alleges that these statements included price predictions and statements implying an “expectation of profit.”
Bittrex is the latest cryptocurrency exchange to face regulatory scrutiny in the U.S. The SEC’s lawsuit against Bittrex is similar to a recent action against Beaxy, a company that settled similar charges. It also suggests the charges that the SEC may bring against Coinbase, the U.S.’s largest exchange, which received a Wells Notice last month. The SEC’s complaint alleges that Bittrex allowed the trading of six cryptocurrencies that are securities. These cryptocurrencies are omise go (OMG), algorand (ALGO), dash (DASH), monolith (TKN), i-house token (IHT), and naga (NGC).
