On May 8, Bittrex Inc. filed for Chapter 11 bankruptcy protection for its US-based business. The move comes three weeks after he accused the Securities and Exchange Commission (SEC) of running an unregistered stock exchange.
According to filings, Bittrex had assets and liabilities estimated to be worth between $500 million and $1 billion each. It also revealed that there are over 100,000 creditors.
The company said it still holds crypto assets for U.S. customers who have not withdrawn their funds by April 30. report.
It said the funds were “safe and secure” and added that it would ask the court to reopen customer accounts so customers can withdraw.
Bittrex global is unaffected
The company also said its Liechtenstein-based offshore operation, Bittrex Global, was not affected by the bankruptcy filing. However, two other entities, Bittrex Malta Ltd. and Bittrex Malta Holdings Ltd., have also filed for bankruptcy protection in the United States.
A Bittrex spokesperson explained:
“This announcement does not affect Bittrex Global. Bittrex Global will continue to operate as normal for customers outside the United States. For customers who have not withdrawn funds from the platform by the end of April, funds will be Safe and secure, our priority is to ensure that our customers are complete.”
The SEC took action against Bittrex on April 17, alleging that the company and its executives were promoting and selling unregistered securities. Bittrex denied the allegations, claiming that the assets provided by the company were not securities.
Since the U.S. Congress has yet to formally classify crypto assets as securities, this is another case of the SEC taking extrajudicial enforcement action to take the law into its own hands.
US operations already closed
In late March, Bittrex announced the closure of its U.S. exchanges amid the escalating war on cryptocurrencies by federal regulators. In October, Bittrex was fined $53 million for violating anti-money laundering (AML) laws.
Founded in 2014, Bittrex was once one of the largest cryptocurrency exchanges in the United States. according to to Coin Gecko.
The crypto market continues its recession today, dropping 1.8%, reducing total capital to $1.18 trillion.
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