SEC Charges Crypto Exchange Bittrex With Operating Unregistered Exchange – The U.S. Securities and Exchange Commission (SEC) charged another cryptocurrency exchange, accusing the trading platform Bittrex of operating “an unregistered national securities exchange, broker, and clearing agency.” Since 2014, Bittrex allegedly sold crypto assets that were “offered and sold as securities.” The SEC’s complaint was filed in the U.S. District Court for the Western District of Washington.
The SEC further alleged that Bittrex Global should have registered the exchange, and the regulator claims the two entities leveraged a “shared order book.” The complaint also notes that Bittrex should have registered as a clearing agency and a broker. “Bittrex regularly engaged in the business of effecting transactions for the accounts of others in crypto assets that were offered and sold as securities,” the SEC’s complaint insists.
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“Today we’re holding Bittrex accountable for its noncompliance,” SEC chair Gary Gensler wrote in a statement on Monday. “Today’s action, yet again, makes plain that the crypto markets suffer from a lack of regulatory compliance, not a lack of regulatory clarity.” “As alleged in our complaint, Bittrex and issuers that it worked with knew the rules that applied to them but went to great lengths to evade them by directing issuer-applicants to ‘scrub’ offering materials of information indicating that certain crypto assets were securities.”
The SEC chairman added: “Further, Bittrex, as alleged, failed to register and comply with U.S. securities laws as an exchange, broker-dealer, and clearing agency. Cosmetic alterations did nothing to change the underlying economic realities of the offerings and Bittrex’s conduct.” The recent news that Bittrex received a Wells notice, which informed the cryptocurrency exchange of a possible enforcement action, has led to a complaint from the SEC.
Bittrex’s general counsel, David Maria, stated that if the SEC were to sue the firm, they would contest the action in court, unless a reasonable settlement offer was presented. As of now, the SEC’s complaint doesn’t include any settlement offer, and the court filing indicates that a jury trial has been demanded. Bittrex Global, along with its CEO William Hiroaki Shihara, has been named in the case.
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