The SEC sued yet another crypto company, this time Bittrex

The U.S. Securities and Exchange Commission filed a lawsuit against crypto exchange Bittrex and one of its co-founders alleging it was operating as an “unregistered national securities exchange, broker, and clearing agency.”

Bittrex co-founder and former CEO William Shihara was named in the suit as was the exchange’s foreign affiliate, Bittrex Global GmbH. The latter, it is alleged, failed to “register as a national securities exchange in connection with its operation of a single shared order book along with Bittrex.”

The SEC accused the defendants of taking steps to avoid regulatory scrutiny.

“Before Bittrex would make an asset available on its platform, Bittrex and Shihara instructed issuer-applicants to delete statements related to “price prediction[s],” “expectation of profit,” and other “investment related terms,” the regulator said in a press release announcing the charges. 

The move against Bittrex is the latest in a string of regulatory actions taken by U.S. agencies policing the crypto space. Binance, Paxos and Kraken are among the crypto companies that have been charged in recent weeks by U.S. regulators.  

Bittrex quit U.S. business

Bittrex just last month said it was shutting down its U.S. operations. At the time, co-founder and CEO Richie Lai wrote, “[r]egulatory requirements are often unclear and enforced without appropriate discussion or input, resulting in an uneven competitive landscape.”

SEC chair Gary Gensler has argued that existing U.S. regulations cover digital asset exchanges and that such venues are allowing the trade of what the SEC deems securities.

Gensler said Monday: “Today’s action, yet again, makes plain that the crypto markets suffer from a lack of regulatory compliance, not a lack of regulatory clarity.”

In the complaint against Bittrex, the agency cited a number of digital tokens that it contends are securities. The tokens named include DASH, OMG and AGLO, among others. 

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