U.S. SEC Charges Another Crypto Exchange; Platform Shuts Down

    The Securities and Exchange Commission (SEC) has brought charges against the cryptocurrency platform Beaxy as well as its executives, alleging that they failed to register as an exchange, broker, or clearing agency. This comes as the latest action taken by the financial watchdogs in their ongoing rampant crackdown on crypto firms operating in the United States.

    SEC Charges Beaxy Crypto Exchange

    The Chicago-based Beaxy Digital Ltd. was also charged by the SEC of fraudulently raising $8 million through its sale of unregistered security with its BXY token. In addition, the SEC also charged founder Artak Hamazaspyan for misappropriating funds worth $900,000 in personal use, including gambling.

    Read More: Will This New Development Propel BNB Price To New All-Time High?

    Along with Artak, two other executives Nicholas Murphy and Randolph Bay Abbott were also implicated in the lawsuit because of a company that they oversaw called Windy — which was responsible for maintaining Beaxy. According to the SEC’s allegations, Windy breached securities laws by transacting business through the Beaxy platform without first registering either as an exchange, a clearing agency, or a broker.

    Beaxy Shuts Down Services

    Following the lawsuit, the crypto exchange announced its decision to immediately halt operations via a post on its website, citing the “uncertain regulatory environment surrounding our business” as the reason for the abrupt move. As a direct consequence of this, the utility of the platform’s native token, BXY, has been lost, leaving investors in distress.

    sec crypto

    While speaking about the continuing crackdowns on several crypto firms including Beaxy, SEC chief Gary Gensler was quoted as saying:

    This case serves as yet another reminder to crypto intermediaries that their business models must comply and adapt to the law, not the other way around.

    According to Beaxy’s official statement, customers of the exchange have the ability to withdraw their funds within 24 hours following the closure of all open orders and balances being verified. The accused individuals have not admitted or denied the allegations leveled against them by the agency.

    Also Read:  Bitcoin Price Reclaims $28,500 Amid Binance FUD, Here’s Why

    Pratik has been a crypto evangelist since 2016 & been through almost all that crypto has to offer. Be it the ICO boom, bear markets of 2018, Bitcoin halving to till now – he has seen it all.

    The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.

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