U.S. Cryptocurrency Exchange Bittrex Agrees to Pay $24 Million to Settle Regulatory Disputes

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U.S. Cryptocurrency Exchange Bittrex Agrees to Pay $24 Million to Settle Regulatory Disputes

Bittrex Reaches $24 Million Settlement

Bittrex, a bankrupt cryptocurrency exchange, ceased its operations in the United States earlier this year. In an effort to resolve charges brought forth by the U.S. Securities and Exchange Commission (SEC), accusing it of operating an unregistered exchange, broker-dealer, and clearing agency, Bittrex has agreed to pay $24 million. This settlement encompasses restitution, prejudgment interest, and civil fines stemming from the SEC’s initial charges filed in April of this year.

Multiple Settlements for Similar Charges

Prior to this, Bittrex had already agreed to pay $24 million and $29 million, respectively, to settle enforcement actions brought by the U.S. Department of the Treasury. The cumulative amounts of these settlements underscore the regulatory issues within the cryptocurrency industry and the challenges it faces in compliance.

SEC Action Against the Crypto Industry

This year has been a pivotal moment for increased SEC oversight in the cryptocurrency industry. Alongside Bittrex, cryptocurrency exchanges Binance, Coinbase, and Kraken are also facing enforcement actions from financial regulatory agencies. This indicates a tightening regulatory environment within the cryptocurrency sector.

Bittrex’s Settlement Agreement

Bittrex and its international subsidiary, Bittrex Global, will pay $14.4 million in restitution, $4 million in prejudgment interest, and $5.6 million in civil fines to resolve legal disputes with U.S. regulatory authorities. However, this settlement agreement is still pending court approval before it becomes official. It’s worth noting that Bittrex Global is the international branch of the Bittrex brand.

SEC Charges

Bittrex has been accused of operating as an unregistered national securities exchange, broker-dealer, and clearing agency since 2014. Additionally, regulators have alleged that Bittrex collaborated with token issuers to evade federal securities regulations. This underscores regulators’ determination to ensure compliant operations in the cryptocurrency market.

Bittrex’s Response to the Settlement

Bittrex co-founder and former CEO William Shihara agreed to the settlement but did not admit or deny the SEC’s charges in the agreement. He stated that the settlement is a positive outcome and helps put an end to the allegations against the company. A spokesperson for Bittrex expressed satisfaction with the outcome of the case.

Additional Actions Against Bittrex

Previously, in October 2022, Bittrex also faced enforcement actions from the U.S. Department of the Treasury, resulting in settlements of $24 million and $29 million. This illustrates that cryptocurrency exchanges are subject to regulatory scrutiny on multiple fronts.

SEC’s Increased Enforcement Actions in Crypto

This year, the SEC has intensified its enforcement actions in the cryptocurrency sector. Besides Bittrex, cryptocurrency exchanges like Binance, Coinbase, and Kraken have also faced charges from financial regulatory agencies. Furthermore, the SEC plans to appeal a judgment in its case against Ripple Labs, in which a federal judge ruled that XRP was not a security. This indicates ongoing efforts by regulatory agencies to ensure market compliance.

Changes in the Crypto Market

Despite facing numerous regulatory actions, the price of Bitcoin has risen by approximately 78% since the beginning of the year. This demonstrates that, despite a changing regulatory environment, the cryptocurrency market continues to exhibit some growth momentum.

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