Bittrex has filed a motion to dismiss litigation with the US Securities and Exchange Commission (SEC). According to the company, the department does not have the authority to regulate cryptocurrencies without the permission of Congress.
This assertion calls into question the SEC’s interpretation of existing rules for digital assets and aims to “create a clearer regulatory framework” for the industry.
Bittrex followed Coinbase’s lead and took a similar approach, closely aligning its arguments with those of the larger platform.
Both defendants acknowledge that the primary sale of certain cryptocurrencies can be classified as a securities transaction, however, the same definition does not apply to assets traded in secondary markets. In this case, the coin should be equated to the category of goods.
According to Bittrex representatives, the SEC did not properly communicate that its actions regarding digital assets did not receive congressional approval.
In April, the regulator filed a lawsuit against the company, accusing it of operating an unregistered securities exchange. Bittrex General Counsel David Maria, in a commentary to the WSJ, noted that the firm was already preparing to wind down operations in the United States when it received notice from the agency.
Recall that on May 8, the exchange filed for insolvency in the United States. According to the documents, the company’s assets and liabilities range from $500 million to $1 billion. The number of creditors exceeds 100,000. The platform said it holds the assets of US customers who did not withdraw them by April 30.
In June, the court allowed Bittrex to open withdrawals for users.
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