Yet another popular cryptocurrency exchange Bittrex announced bankruptcy on Monday, May 8. This announcement comes as Bittrex winded down its operations in the US last month following a regulatory crackdown.
Last month around mid-April 2023, the U.S. Securities and Exchange Commission (SEC) charged Bittrex for operating as an unregistered securities exchange and violating federal laws. However, this winding down of the operations is only for the US market.
Bittrex Global stated that it will continue its operations as normal for customers outside the US. For the US-based customers who haven’t withdrawn assets from the exchange, Bittrex said it intends “to ask the court to activate those accounts as soon as possible so that customers meeting the necessary regulatory requirements will be able to withdraw them.”
Bittrex is the latest victim of the heavy regulatory crackdown by the US SEC over the past few months. After the fall of FTX in November 2022, the SEC has gone hammer and tongs after all of the big crypto trading platforms such as the likes of Coinbase.
Bittrex Assets and Liabilities
In its Chapter 11 details, Bittrex has listed assets and liabilities in excess of $1 billion each. Besides, the court papers show that Bittrex-related entities like Desolation Holdings LLC, Bittrex Malta Holdings Ltd. and Bittrex Malta Ltd. have also entered bankruptcy.
In its charges against Bittrex last month, the SEC said that Bittrex broke the regulatory rules from 2017 to 2022 while clocking revenue of at least $1.3 billion. The SEC said that Bittrex violated rules by acting as a brokerage, exchange, and clearing agency, without registering with the regulator. Although Bittrex vowed to take legal action against the SEC, it eventually didn’t succeed.
In the latest filing, Bittrex said that the US Treasury’s Office of Foreign Assets Control is its biggest unsecured creditor to whom it owes $24 million from an earlier settlement from failing to prevent customers in Iran and other sanctioned nations from using its platform.
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