Bittrex has received a Wells Notice from the Securities and Exchange Commission (SEC) while preparing to wrap up operations in the U.S.
Bittrex, a crypto exchange preparing to shut down operations in the U.S., is in the crosshairs of the SEC. The regulatory body has intensified its mission to clamp down on crypto businesses since the start of this year.
David Maria, the general counsel at Bittrex, told the WSJ that they received a Wells Notice alleging engagement in business activities as an exchange, broker-dealer, and clearinghouse without registrations.
A Wells Notice is a formal notification from the SEC informing that they are considering legal action against an individual or an entity.
Wells Notice May Not Necessarily Lead to Court Action
Nevertheless, not all instances involving a Wells Notice from the SEC result in court proceedings. Sometimes, the regulatory body may drop the investigation or come to a settlement agreement with the party involved.
Maria said they are unsure if the regulators would take them to court because the company is already shutting down its operations. But, if the regulatory agency takes enforcement actions, Bittrex would litigate unless the SEC “came with a reasonable settlement offer.”
After a long history of struggle with regulators, the nine-year-old exchange finally decided to shut down its platform, citing the “unclear regulatory environment.”
A former SEC attorney, John Reed Stark, believes that “Coinbase is next for an SEC lawsuit.” Coinbase already received a Wells Notice last month.
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