Bittrex files for Chapter 11 bankruptcy just weeks after SEC charges


Bittrex files for Chapter 11 bankruptcy just weeks after SEC charges

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The firm estimated it had more than 100,000 creditors, between $500 million and $1 billion in assets, and between $500 million and $1 billion in liabilities. 2325 Total views 16 Total shares Cryptocurrency trading platform Bittrex has filed for Chapter 11 bankruptcy protection in the District of Delaware. In a May 8 filing in the United States Bankruptcy Court for the District of Delaware, Bittrex estimated it had more than 100,000 creditors, between $500 million and $1 billion in assets, and between $500 million and $1 billion in liabilities as part of bankruptcy proceedings. The bankruptcy covers its Seattle-based entity Bittrex, Inc, two Bittrex entities in Malta and an affiliated entity Desolation Holdings LLC. Bittrex Global GmbH, the Liechtenstein-based global entity for exchange, was not included in the filing. The declaration followed the U.S. Securities and Exchange Commission (SEC) charging the company and its co-founder and former CEO William Shihara for securities violations in April. The SEC claimed Bittrex, Inc and Bittrex Global operated an unregistered securities exchange. In October, the exchange also received charges pertaining to Bank Secrecy Act violations from the U.S. Treasury’s Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN) and agreed to pay around $29 million in a settlement. OFAC is the largest creditor listed on Bittrex’s bankruptcy filing, with the exchange booking a $24.2 million claim for the Office. Its next largest creditor is a crypto wallet with a $14.5 million claim. FinCEN is also listed as a top 50 creditor with a claim of $3.5 million, the SEC is listed with an undetermined amount of claims. OFAC takes the top creditor spot for Bittrex with claims of $24.2 million. Source: PACER The SEC’s enforcement actions and its recent bankruptcy filing comes as Bittrex announced in March that it would wind down its U.S. operations by April 30 citing “continued regulatory uncertainty” in the country. Related: Tencent-backed Everledger collapses amid lack of funding: Report It has been a hard year for Bittrex’s entity in the U.S. in 2023. The exchange also cut 83 employees in February citing the crypto market downtown caused by the collapses and bankruptcies of other crypto firms. Bittrex’s bankruptcy is the latest in a line of other crypto exchange or lending platforms that have also recently filed for Chapter 11 protection, inclduing FTX, BlockFi, Celsius and Voyager Digital. Cointelegraph contacted Bittrex Global’s CEO Oliver Linch for comment but did not immediately receive a response. Magazine: Crypto winter can take a toll on hodlers’ mental health Update (May 8, 10:50 pm UTC): This article has been updated with additional information from the bankruptcy filing and further background information. Additional reporting by Jesse Coghlan.