SEC : crypto trading platform Beaxy forced to cease operations

Pursued by the U.S. regulator SEC, crypto exchange Beaxy is being forced to cease operations. Indeed, the SEC continues its repressive policy towards US-based crypto exchanges.

As a reminder, recently, the SEC shut down Kraken’s crypto staking service in the US. This time, it’s around the Beaxy platform.

Accused by the Securities and Exchange Commission (SEC) of being a stock exchange, the crypto exchange Beaxy preferred to submit to the injunctions of the regulator who obtained the outright closure of the crypto trading platform which certainly does not have the financial means to face the SEC in court.

In a statement, U.S. regulators accuse the crypto asset trading platform beaxy and its executives of failing to register as a national securities exchange, broker and clearing agency.

The SEC is also accusing the platform’s founder, Artak Hamazaspyan, and a company he controlled, Beaxy Digital, Ltd. of raising $8 million in an unregistered offering of the Beaxy token (BXY). The Beaxy founder is further accused of embezzling $900,000 for personal expenses such as gambling.

SEC Chairman Gary Gensler said:

We allege that Beaxy and its affiliates operated as exchanges, brokers, clearing agencies, and dealers without registering with the Commission and without complying with clear and proven rules governing these activities.

Our securities laws for decades have served to protect investors, make capital formation easier and cheaper, and improve our markets. This case is another reminder to crypto intermediaries that their business models must comply and adapt to the law, not the other way around.”

On its website, Beaxy announced the bad news to its customers, and stated that they will be able to withdraw their funds still present on the crypto trading platform that will disappear.

The company refers to its cooperation with the SEC for more than two years that ultimately leads to the closure of the crypto exchange, and the dismissal of its staff.

Unfortunately, despite our best efforts, it has become clear that the regulatory environment is simply too uncertain to continue our operations.