{"id":386799,"date":"2023-04-18T19:28:32","date_gmt":"2023-04-18T19:28:32","guid":{"rendered":"https:\/\/insidebitcoins.com\/?p=386799"},"modified":"2023-04-18T19:29:19","modified_gmt":"2023-04-18T19:29:19","slug":"sec-accuses-bittrex-of-conducting-unregistered-business","status":"publish","type":"post","link":"https:\/\/insidebitcoins.com\/news\/sec-accuses-bittrex-of-conducting-unregistered-business","title":{"rendered":"SEC accuses Bittrex of conducting unregistered business"},"content":{"rendered":"

Yesterday we reported on the decision by Bittrex<\/a>, once one of the major exchanges in the world, to leave the U.S. due to impending government regulatory action. On Monday, the news was delivered the the Securities and Exchange Commission (SEC), the main financial regulatory body in the U.S., has filed a complaint<\/a> against the exchange.<\/p>\n

The former CEO and cofounder of Bittrex, William Shihara, has been accused by the US Securities and Exchange Commission (SEC) with running an unlicensed national securities exchange, broker, and clearing agency. Separate charges were brought by the agency against Bittrex Global.<\/p>\n

In the Western District of Washington U.S. District Court, the SEC accuses the corporations and Shihara of violating the Exchange Act on four counts. Further charges are being brought against Bittrex Global “in connection with its operation of a single shared order book alongside Bittrex.”<\/p>\n

Bittrex’s Beginnings<\/h2>\n

Bittrex was established in 2014 by Bill Shihara, Richie Lai, and Rami Kawach, and quickly became a major player in the quickly developing field of cryptocurrency exchanges. Bittrex was created to address the common problems with security, stability, and scalability that plagued early cryptocurrency exchanges<\/a>. It was built on the collective experience of its creators. The founding team’s experience in security engineering at top software firms like Microsoft, Amazon, and BlackBerry prepared the ground for Bittrex’s rapid ascent.<\/p>\n

What’s of note is that Bittrex stood out from its rivals due to its consistent dedication to security and legal compliance. The exchange put in place security features that set the standard for the industry, like two-factor authentication (2FA), mandatory wallet encryption, and recurring third-party audits. AML (Anti-Money Laundering) and KYC (Know Your Customer) regulations were strictly followed by Bittrex, thus assuring a reliable and open platform. These initiatives helped Bittrex establish a solid reputation as a trustworthy and safe exchange in the cryptocurrency<\/a> industry.<\/p>\n

Changing Times<\/h2>\n

The SEC’s accusations show how much times have changed since then. It alleges that the exchange has allowed trading of tokens which were actually securities.<\/p>\n

The OMG, Dash, Algorand, Monolith (TKN), Naga (NGC), and IHT Real Estate Protocol (IHT) tokens traded on Bittrex, according to the SEC’s complaint, are securities. The SEC has come under fire in the past for its “regulation by enforcement” strategy, which claims tokens are securities only when it files complaints against them and not before.<\/p>\n

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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<\/a><\/p>\n

— U.S. Securities and Exchange Commission (@SECGov) April 17, 2023<\/a><\/p><\/blockquote>\n