On August 10, the US Securities and Exchange Commission (SEC) announced that it had managed to reach an agreement with Bittrex, settling all claims against the exchange. As a part of the agreement, Bittrex will have to pay $24 million. Let's break down what happened.
A brief overview of the case
On April 17, 2023, the SEC filed charges against Bittrex and its former CEO for operating as an unregistered securities exchange. The foreign affiliate of the exchange, Bittrex Global GmbH, also faced these charges within the US.
In addition, the SEC alleges that Bittrex and Bill Shihara, who served as CEO from 2014 to 2019, advised projects before listing to remove "problematic statements" from their social media accounts. Such statements could lead to the tokens they issued being categorised as securities and attracting regulatory attention. Notable tokens in question include OMG, DASH, and ALGO.
On May 8, 2023, the U.S. division of the exchange declared bankruptcy. However, this had no impact on Bittrex Global, which is based in Liechtenstein and serves non-US clients. According to the statement, customers were given a window until August 31st, 2023, to withdraw their funds.
Latest updates
Yesterday, on August 10, as stated in the SEC’s press release, Both Bittrex and Bittrex Global agreed to settle the matter by collectively paying fines totaling $24 million. The agreement is now subject to court approval.
Gurbir S. Grewal, Director of the SEC's Division of Enforcement, emphasised that “settlement makes clear that you cannot escape liability by simply changing labels or altering descriptions because what matters is the economic realities of those offerings”.
Recall that the SEC continues to actively regulate the crypto space. Thus, among others, there are currently cases against Ripple, Coinbase, and Binance US.
Also read:
Crypto: security or commodity?
