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The bankruptcy filing does not affect the operations of Bittrex Global, which will continue to serve customers outside the US.
US crypto exchange Bittrex filed for bankruptcy in a federal court in Delaware yesterday (8 May), days after ceasing all its US operations.
The trading platform, once one of the biggest in the US, was charged by the Securities and Exchange Commission (SEC) last month after claiming Bittrex had been operating as an “unregistered national securities exchange, broker and clearing agency”.
The SEC also alleged former CEO William Shihara told issuers to delete “problematic statements” including price predictions, expectations of profit and other “investment related terms” before putting crypto assets on the platform.
Bittrex, which was in the process of exiting the US market, denied the allegations and told US customers to withdraw funds by 30 April, the day the company official ceased operations.
“For those customers who did not withdraw their funds from the platform prior to the end of April, your funds remain safe and secure, and our main priority is to ensure that our customers are made whole,” the Seattle-based exchange wrote in a statement.
The latest filing for bankruptcy does not impact Bittrex Global, which is expected to continue its operations for customers outside the US.
Bittrex also confirmed that while the court will ultimately decide the method by which the remaining funds can be claimed, it will ask the court to activate those accounts “as soon as possible” so that customers who meet regulatory requirements can withdraw them.
The company’s assets and liabilities were both between $500 million and $1 billion, according to a bankruptcy petition seen by Reuters.
The crypto sector has not been having a good time in the US.
In March, US regulators sued the world’s largest crypto exchange, Binance, for numerous alleged violations of US trading rules. Binance responded to the complaint calling it “an incomplete recitation of facts” after an initial review of the filing.
Earlier in March, the crypto-focused Silvergate Capital announced plans to wind down its operations and liquidate its bank, due to its recent wave of financial issues and the turmoil of the crypto industry.
Yesterday (8 May), Binance said it resumed bitcoin withdrawals after halting them twice in less than 12 hours amid a “large volume of pending transactions”.
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