Table of Contents:

· Layoffs, fines, Bittrex shuts down US operations

· Filing for bankruptcy, Bittrex officially becomes history

Bittrex is finally going to officially exit the stage of the cryptocurrency industry.

November 21st, according to official sources, Bittrex Global announced that the exchange will terminate all its operations. Starting from 0:00 on December 5th, 2023 Beijing time, all trading activities on Bittrex Global will be disabled. After this date, customers will only be able to withdraw their assets during the liquidation process.

This also marks the official history of Bittrex.

Bittrex states that all funds and tokens on the Bittrex Global platform are safe and reliable. It strongly recommends that all users log in to their accounts and withdraw their assets as soon as possible. However, Bittrex's withdrawal service will not support USD withdrawals, and users will need to convert all USD balances to euros or cryptocurrencies for withdrawals.

The once largest Bitcoin exchange in the world will become history, and the driving force behind this, in addition to the fierce competition of the exchange itself, cannot be ignored by the SEC and other regulatory forces.

Layoffs, Fines, Bittrex Shuts Down US Business

According to public information, Bittrex, headquartered in Seattle, USA, was established in 2013 and is also known as "B-Net". It was once listed as one of the world's top three cryptocurrency exchanges. The platform has listed more than 300 currencies, and in early 2018, its market share in the USD-supported spot trading market reached nearly 23%.

The good times didn't last long, and in 2022, the regulatory forces in the United States came down heavily. On October 11, 2022, the Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN) of the US Treasury Department announced settlements of over $24 million and $29 million with Bittrex, a virtual currency trading platform based in Washington.

Source: OFAC

It is worth noting that this is also the largest virtual currency enforcement action by OFAC to date. According to OFAC and FinCEN's investigation, the company clearly violated multiple sanction programs and intentionally violated the anti-money laundering (AML) and suspicious activity reporting (SAR) requirements of the Bank Secrecy Act (BSA).

Under the heavy pressure of regulation, Bittrex has seen a constant stream of internal executives leaving. For example, on November 28, 2022, according to Bloomberg, Michael Schroeder, former Chief Compliance and Risk Officer of Bittrex, joined Coinbase as the Internal Control Director for Coinbase Germany.

Starting from February 2023, Bittrex began to lay off employees one after another. As of February this year, according to LinkedIn's database, Bittrex has 284 employees. Subsequently, the US Department of Labor warned that the cryptocurrency exchange Bittrex will lay off 83 people starting from April 2nd.

Source: Washington State Employment Security Department

At that time, according to internal emails displayed on social media, Bittrex co-founder and CEO Richie Lai told employees: "The market downturn caused by multiple failures in the cryptocurrency ecosystem has turned into a complete collapse by the end of the year. These events have led Bittrex to revise its strategy."

Following that, on April 1st, Ritchie Lai released a statement announcing the closure of their US platform on April 30th. He pointed out that given the current regulatory and economic environment in the US, it is not feasible to continue operations from an economic perspective.

"Regulatory requirements are often unclear and enforced without proper discussion, resulting in an uneven competitive landscape. Therefore, operating in the United States is no longer feasible. All customer funds are safe and can be withdrawn."

申请破产，Bittrex 正式成为历史

申请破产，Bittrex officially becomes history

Despite this, Bittrex has retained its business outside of the United States. However, this year, under the heavy regulation of the U.S. Securities and Exchange Commission (referred to as the SEC below) and the intense competition in the industry, Bittrex has finally gone bankrupt.

On April 17th, the SEC, which has been rampant in the cryptocurrency industry for many years, finally targeted Bittrex, accusing Bittrex and its former CEO of providing securities trading services without registering the trading platform. In the indictment, the SEC listed OMG, DASH, ALGO, TKN, NGC, IHT, and other securities traded on Bittrex.

Source: US SEC

On May 9th, it was reported that Bittrex has officially filed for bankruptcy in Delaware, USA. According to court documents, Bittrex is estimated to have assets and liabilities ranging from $500 million to $1 billion, with over 100,000 creditors.

Additionally, two other entities, Bittrex Malta Ltd. and Bittrex Malta Holdings Ltd., have also filed for bankruptcy protection in the state of Delaware. However, according to a spokesperson for Bittrex Inc., the bankruptcy protection filings will not affect Bittrex Global.

For the US market, Bittrex has not failed to try to regain its position. On July 2nd, Bittrex submitted a motion to dismiss the lawsuit filed by the SEC. Bittrex argued that the SEC does not have the necessary authority to regulate cryptocurrencies as securities unless it is explicitly authorized by Congress.

Source of the image: Legal document record

Like Coinbase, this claim challenges the US Securities and Exchange Commission's interpretation of existing securities regulations and seeks to establish a more clear regulatory framework to accommodate the unique characteristics of digital assets.

The encryption venture capital firm Paradigm also believes that the case should be dismissed by the court, and submitted an explanation on July 11th, stating that the incident did not involve "investment contracts" and therefore did not fall within the SEC's jurisdiction of securities transactions, and the SEC does not have the authority to regulate secondary market transactions of cryptocurrencies.

Following that, on August 11th, Bittrex reached a settlement with the SEC. Bittrex and Bittrex Global agreed to surrender $14.4 million in illegal gains, $4 million in pre-judgment interest, and a civil penalty of $5.6 million, for a total of $24 million.

5 days later, Bittrex Global's legal advisor Andrew Michaelson said: "Our client Bittrex Global will forget about this matter and will not pay any settlement fees."

On October 31st, according to Reuters, Bittrex's bankruptcy plan has finally been approved by the bankruptcy court, which will close its US business and allow the company to liquidate through a plan that will fully pay the remaining creditors.

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