![Crypto exchange Bittrex files for bankruptcy after SEC complaint](https://i-invdn-com.investing.com/trkd-images/LYNXMPEJ470Q3_L.jpg)
By Dietrich Knauth
(Reuters) – Cryptocurrency alternate Bittrex Inc filed for chapter safety on Monday, three weeks after the U.S. Securities and Change Fee (SEC) accused it of working an unregistered securities alternate.
Seattle-based Bittrex ceased operations in america on April 30, and it stated the chapter submitting wouldn’t affect Bittrex World, which serves clients exterior america. The corporate’s non-U.S. operations are based mostly in Liechtenstein.
Bittrex’s belongings and liabilities have been each between $500 million and $1 billion, in accordance with a chapter petition filed in Wilmington, Delaware courtroom.
Bittrex stated that it was nonetheless holding crypto belongings of U.S. clients who didn’t withdraw funds earlier than April 30.
These belongings are “secure and safe” and Bittrex stated it supposed to ask the chapter courtroom for a restricted re-opening of buyer accounts in order that the crypto might be distributed again to clients.
A number of corporations within the crypto trade have tumbled into chapter 11 over the previous yr, felled by a drop in asset costs, renewed regulatory scrutiny, and within the case of the once-prominent alternate FTX, felony prices.
The SEC sued Bittrex on April 17, alleging that former CEO William Shihara inspired crypto asset issuers in search of to make their tokens accessible on the corporate’s platform to delete public statements that might lead regulators to research these token choices as securities.
Bittrex has denied the SEC’s allegations, saying the crypto belongings on its platform weren’t securities or funding contracts.
Whereas the SEC’s lawsuit stays pending, Bittrex had beforehand agreed to pay $29 million in fines to the U.S. Treasury Division for “obvious violations” of sanctions on sure international locations and anti-money laundering legislation.
Bittrex’s petition listed the Treasury Division’s Workplace of Overseas Asset Management as the corporate largest unsecured creditor, with greater than $24 million owed to the company.
Bittrex’s different largest collectors have been largely clients of the crypto alternate. Bittrex listed 16 clients with at the least $1 million of their accounts, with out figuring out them by identify. Bittrex’s largest remaining buyer account has $14.6 million in belongings, in accordance with the petition.