US SEC Slaps $24 Million Penalty on Bittrex, Here’s Why
The U.S. Securities and Exchange Commission (SEC) has slapped a $24 million penalty on the crypto exchange Bittrex for offering client services without any registration with the federal securities regulator.
Earlier this year in April, the SEC had already alleged that Bittrex was functioning as an unregistered securities exchange, clearing agency, and broker in the period between 2017 and 2022. In this period, the exchange reportedly made $1.3 billion in total revenue.
In addition, the regulatory body filed a lawsuit against co-founder William Shihara and the worldwide affiliate Bittrex Global GmbH, both of whom are included in the settlement announcement issued on Thursday.
Neither Bittrex nor Shihara admitted or denied the allegations made by the regulator. Bittrex has not provided an immediate response to a comment request. Shihara deemed the settlement arrangement as a favorable outcome as he didn’t have to pay any fine. He also expressed hopes that the settlement would aid the United States in achieving a harmonious equilibrium between safeguarding investors and fostering innovation.
In its lawsuit earlier this year in April, the SEC said that Shihara and Bittrex coordinated with traders to first delete any “problematic statements” that could attract scrutiny from the regulator. Previously, Bittrex noted that they would fight the case in court. Besides, it also denied any sort of offering of investment contracts or securities for trade on Bittrex.
SEC Action on Exchanges
Since assuming leadership in 2021, SEC Chair Gary Gensler has consistently asserted that a majority of tokens fall under the purview of SEC’s supervision. He also noted that a significant number of crypto firms have been engaging in unlawful activities.
In addition to Bittrex, the regulatory body has filed lawsuits against prominent exchanges like Coinbase Global Inc. and Binance Holdings Ltd. in recent months. Both of these companies have refuted any wrongdoing and are currently challenging the agency’s allegations through legal proceedings.
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