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A Possible Action against the crypto reported by the SEC

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Allegedly, SEC (Securities and Exchange Commission) issued a Wells notice to the Seattle-based crypto exchange, Bittrex of an enforcement action against them.

Reportedly, the Securities and Exchange Commission has notified Bittrex through a good notice of an impending enforcement action.

What Led to The Wells Notice

According to the notice, the company has been operating as a broker-dealer, an exchange, and a clearinghouse without registering with the regulators.

As of March, the enforcement division of the SEC informed the Bittrex about an enforcement action against them known as Wells Notice.

According to Bittrex’s general counsel, David Maria statement, this notice came a bit late.

The notice landed after the cryptocurrency exchange has already begun the winding down of its business activities in the United States.

READ ALSO: Ripple Launches Liquidity Hub To Upgrade Business Payment

Recall back to March 31, announced that it will be shutting down its operations due to the present United States regulatory and economic atmosphere.

As per reports from the General Counsel of Bittrex, the firm researched the option of registering its business activities with the Securities and Exchange Commission last year.

However, it later found out that the option is not viable especially, since Bittrex will need to necessarily halt every one of its revenue-producing transactions.

Maria goes further to lament that “lack of regulatory transparency led to huge costs and no guarantee of what can and cannot be offered”.

READ ALSO: US House of Rep Attempts to Develop Draft Bill Unofficially

SEC’s Reason for High Standards During Registration

The Securities and Exchange Commission requires cryptocurrency companies such as Bittrex to register with SEC.

This is to allow the regulatory body lower the clash of interests as well as make cryptocurrency exchanges appear similar to conventional stock exchanges.

One of the key pain points in this instance is how cryptos are explained as securities. As a result, it places them under the Securities and Exchange Commission’s scrutiny.

Oftentimes, the regulatory body wouldn’t explain 1 digital asset as a security but refers to the Howey test. Thus, Bittrex is not sure whether SEC will file a suit because of the company shutdown of its United States operations.

READ ALSO: Conflux to Introduce Uniswap v3 With Chinese CNH On Its Platform

Bittrex Response

Maria stated further that Bittrex is ready to take up this issue with the courts unless the regulators “present a settlement offer that is reasonable”.

After all, this current SEC investigation is like adding insult to injury. That is after the company was fined up to $53 million last year because of “apparent violations” of the United States’ multiple sanctions programs.

Allegedly, they failed to monitor suspicious cryptocurrency transactions from individuals located in Syria, Cuba, Sudan, Iran, as well as the Crimea area of Ukraine. As a result, they were able to engage in more than $263M from March 2014 to December 2017.

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