SEC charges Bittrex with unregistered operations, calls six tokens securities
The United States Securities and Exchange Commission (SEC) has charged the crypto asset trading platform Bittrex and its cofounder and former CEO William Shihara for operating an unregistered national securities exchange, broker, and clearing agency. The agency filed a separate charge against Bittrex Global.
The SEC is pressing four charges of Exchange Act violations against the companies and Shihara in the U.S. District Court Western District of Washington. Bittrex Global is also being charged “in connection with its operation of a single shared order book along with Bittrex.”
The SEC argued in its complaint that the OMG (OMG), Dash (DASH), Algorand (ALGO), Monolith (TKN), Naga (NGC) and IHT Real Estate Protocol (IHT) tokens traded on Bittrex are securities. The SEC has been criticized in the past for the practice of “regulation by enforcement” by claiming tokens are securities only at the time when it files such complaints, and not prior.
Today we charged crypto asset trading platform Bittrex Inc. and its co-founder and former CEO William Shihara for operating an unregistered national securities exchange, broker, and clearing agency.https://t.co/kBsIFMp7ZA
The agency also claims Bittrex and Shihara advised clients to delete “problematic statements” to avoid regulatory scrutiny. The SEC complaint sought disgorgement, penalties and permanent injunctions against the defendants in a jury trial. SEC enforcement division director Gurbir Grewal said in a statement:
Bittrex was expecting the SEC action and reportedly received a Wells Notice warning it of the impending action in March. The exchange had already announced its intention of closing down U.S. operations on April 30 due to the regulatory environment.
Related: Protocol
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