Embattled Crypto Exchange to Pay a $24 Million Penalty to Settle With SEC

The once-prominent cryptocurrency exchange Bittrex has reportedly reached an agreement to pay a sum of $24 million in penalties in order to settle its dispute with the United States Securities and Exchange Commission (SEC).

Earlier, the SEC had accused the platform of offering services to American clients without obtaining the necessary registration.

Following the regulator’s action against Bittrex, the exchange decided to close down its operations in the US and sought bankruptcy protection.

According to a Bloomberg report, both Bittrex and its non-US subsidiary have agreed to pay $24 million to resolve allegations of violating multiple securities regulations while providing cryptocurrency services to users in the US.

Co-founder William Shihara of the company expressed approval of the settlement plan, indicating optimism that it might aid US authorities in finding a balance between protecting investors and fostering innovation.

Bittrex and Shihara have been navigating through significant challenges over the past months due to the SEC’s adversarial approach.

The company ceased its operations in the United States in late March of this year, citing concerns about the nation’s “regulatory and economic environment.” Nevertheless, it reassured users that their funds were secure and available for withdrawal.

Several weeks later, the exchange received a Wells Notice from the SEC, which alleged that Bittrex had been functioning as an unregistered exchange, broker-dealer, and clearinghouse for securities.

Approximately three weeks after the SEC’s actions, the company filed for Chapter 11 bankruptcy protection in the US. According to the filing, Bittrex had over 100,000 creditors, and its estimated liabilities and assets both fell within the range of $500 million to $1 billion.

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