- The SEC sued Bittrex and its former CEO, William Shihara.
- The agency accused Bittrex of operating an unregulated securities exchange, broker, and clearing agency.
- The SEC also claimed that Bittrex ordered crypto projects seeking to sign up to scrub public statements they had made in the past that could have drawn the attention of regulatory agencies.
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The SEC’s war on crypto continues. The regulator filed civil charges today against Bittrex for operating as a national securities exchange without proper registration.
Scrubbing Problem Statements
Yet another crypto company has fallen victim to the predatory eye of the SEC.
The US Securities and Exchange Commission Office has partnered now that it is charging crypto exchange Bittrex and former CEO William Shihara for allegedly operating an unregistered national securities exchange, broker, and clearing agency. The SEC also sued Bittrex’s foreign affiliate, Bittrex Global, for failing to register as a national securities exchange.
The SEC admitted to his COMPLAINT that Bittrex facilitates the buying and selling of cryptocurrencies that the agency believes are securities—including OMG, DASH, ALGO, TKN, NGC, and IHT.
According to the SEC, Bittrex and Shihara instructed the teams behind these cryptocurrencies to scrub “problematic statements” they had made publicly in the past that they believed would bring the attention of a regulatory agency—such as the SEC itself. Price predictions, profit expectations, and other investment-related terms are mandated to be removed before Bittrex assets are listed.
“Today’s action, once again, makes clear that the crypto markets suffer from a lack of regulatory compliance, not a lack of regulatory clarity,” said SEC Chair Gary Gensler. “As our complaint states, Bittrex and the issuers it works with know the rules that apply to them but continue to evade them by directing issuer-applicants to ‘scrub ‘ which offers informational materials indicating that some crypto assets are securities.”
Bittrex Global ANSWERED in the civil suit by claiming that it does not serve any US customers and “hurts” by banning US residents from using the exchange. It also criticized the SEC for not seeking to engage with the company before suing. “Bittrex Global is ready to work productively with the SEC-as we do with all regulators-to explain our position. It has become clear that the SEC is not interested in such discussions.
Disclosure: At the time of writing, the author of this piece owns BTC, ETH, and other crypto assets.