Bittrex, a company that allows people to trade cryptocurrencies, has agreed to pay $24 million to settle a case with a U.S. government agency called the Securities and Exchange Commission (SEC). The SEC said that Bittrex did not follow the rules and register with them.
This news came out because of a document filed in a court in Seattle on a Thursday.
Back in April, the SEC started a legal action against Bittrex Inc and its former CEO William Shihara. The SEC said that they were running a cryptocurrency trading place that wasn’t registered properly with the government. The SEC also said that Bittrex’s affiliate company, Bittrex Global GmbH, also didn’t register as it should have, especially in connection with how it managed trading orders.
After this legal fight, Bittrex Inc asked for bankruptcy protection in May.
The settlement deal says that both Bittrex Inc and Bittrex Global have to pay a fine of $5.6 million and give up $18.4 million that they earned in a way that the government thinks is against the law. They will have to do this about 60 days after they explain how they are going to deal with their debts as part of the bankruptcy case.
As part of the settlement, Bittrex Inc, Bittrex Global, and William Shihara have to agree to follow the rules about trading and investments set by the U.S. government. This way, they promise to not break these rules again. However, they don’t have to admit that they actually did anything wrong according to the SEC.
A spokesperson from Bittrex said they are happy that they could settle this case and they will tell more about it once the court agrees. It’s important to note that Bittrex had said before that they didn’t do anything wrong with trading securities (which are like investments) on their platform.
Bittrex Global, on the other hand, wants to make clear that it doesn’t serve customers in the United States.
The SEC’s person in charge of making sure rules are followed, Gurbir Grewal, said that this settlement shows that just changing names or descriptions isn’t enough. He said that these cryptocurrency activities need to be looked at closely to see if they really follow the rules.
William Shihara, in response to the settlement, said it’s a good thing. He talked about how it’s important to balance making new things and businesses with protecting people who use them. He hopes that this settlement helps make that balance better.