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US Crypto Exchange Bittrex Reportedly in Trouble With SEC

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  • What – Bittrex Global, a cryptocurrency exchange platform, could face potential enforcement action from the US Securities and Exchange Commission (SEC) following its ongoing investigation into the company’s activities. 
  • Why – This latest development comes after the Wall Street Journal report.
  • What Next – The report states SEC is reviewing Bittrex’s compliance with anti-money laundering (AML) and know-your-customer (KYC) regulations. 

The report by the Wall Street Journal states that the SEC has issued a Wells notice to Crypto exchange Bittrex, which is a warning that enforcement action may be taken against the company. 

The notice indicates that the SEC’s staff has made a preliminary determination that the company may have violated securities laws.

SEC Takes On Bittrex

According to the report, the investigation is focused on whether Bittrex allowed unregistered securities to be traded on its platform and whether the company has failed to implement adequate AML and KYC measures. 

Bittrex Global, based in Liechtenstein and has offices in the US, UK, and other countries, has not yet stated the matter. 

However, the company’s CEO, Tom Albright, reportedly confirmed the investigation to the Wall Street Journal but declined to comment further. 

This news follows a recent crackdown by the SEC on cryptocurrency exchanges, which has seen the regulator take action against several platforms for violating securities laws. 

In February, the SEC charged Crypto exchange BitMEX and its executives with violating AML and KYC regulations. The SEC also charged Ripple, the company behind the XRP token, with conducting an unregistered securities offering. 

Bittrex is not the only exchange to face potential enforcement action from the SEC. Coinbase, one of the largest cryptocurrency exchanges in the US, announced in March that it had received a Wells notice from the SEC regarding its planned launch of a lending product. 

The SEC reportedly believes that the product, which would allow users to earn interest on their cryptocurrency holdings, may be a security. The news of the SEC’s investigation into Bittrex has caused concern among some cryptocurrency investors. The investigation could lead to the company being forced to pay significant fines or even being shut down. 

This could have a significant impact on the cryptocurrency market, as Bittrex is one of the largest exchanges in the world, with a daily trading volume of around $250 million. 

However, some analysts have suggested that the impact of the investigation may be limited. Bittrex is not as well-known as some of the other exchanges that have faced enforcement action from the SEC, such as Coinbase and BitMEX. 

Additionally, the company has not been accused of any wrongdoing at this stage, and the investigation could be resolved without any enforcement action being taken. 

The news of the investigation comes at a time when the cryptocurrency market is experiencing significant growth. Bitcoin, the largest cryptocurrency by market capitalization, has seen its value rise by more than 300% over the past year, reaching a record high of over $64,000 in April. 

Other cryptocurrencies, such as Ethereum and Binance Coin, have also seen significant gains in value. 

The growth of the cryptocurrency market has led to increased scrutiny from regulators, who are concerned about the potential for fraud and other illegal activities. 

The SEC has been particularly active in this area, with Chairman Gary Gensler calling for increased cryptocurrency market regulation. 

In conclusion, Bittrex Global’s potential enforcement action by the SEC is the latest development in a series of crackdowns on cryptocurrency exchanges. 

The investigation is focused on whether the company has violated securities laws and failed to implement adequate AML and KYC measures. The outcome of the investigation could have a significant impact on the cryptocurrency market, but the impact may be limited.

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