The United
States has objected to a proposal by the cryptocurrency exchange Bittrex to return
customer cash and cryptocurrency as part of a process to wind down its operations
in the country. Bittrex’s US arm filed for bankruptcy
protection in May
weeks after exiting the country over regulatory challenges.
In the same
month, the cryptocurrency exchange sought permission from the bankruptcy
Bankruptcy
Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co
Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co
Read this Term court in Delaware to pay
its customers their crypto holdings in line with terms agreed with customers and to avoid costly litigation. Previously, the exchange argued that courts have permitted payments such as for
critical services before a firm’s bankruptcy plan confirmation hearing.
US Calls Bittrex’s Plan ‘Premature’
However, in
a motion filed
yesterday (Wednesday), the US government countered the proposal, describing it
as ‘premature’ as ‘confirmation is months away’. It noted that if Bittrex
sought to avoid litigation expenses, then it ought to have filed a motion
seeking compromise authority or permission to settle the dispute without going
to trial.
Furthermore,
the government dismissed Bittrex’s argument that courts previously authorized
payments for critical services, noting that the ‘critical vendor’ standard does
not apply to the case.
“This is
not the case here. Instead of reorganizing, the Debtors [Bittrex] intend to
liquidate and shutdown their exchange,” the government’s counsel noted. “The
Debtors shall soon have no business and no future customers, vendors, or
creditors.”
The US
government’s opposition to Bittrex’s proposal for customer withdrawals follows a
violations settlement of $29 million reached with the cryptocurrency exchange
Cryptocurrency Exchange
A cryptocurrency exchange is an online platform that supports the exchange of various currencies for a cryptocurrency or digital asset.Comparable to a generalized financial exchange, a crypto exchange’s core function is to permit and encourage the buying and selling of cryptos.This is accomplished by producing a stable trading environment suitable for traders nested through different locations around the world. Sometimes a crypto exchange may be referred to as a digital currency exchange (DCE) f
A cryptocurrency exchange is an online platform that supports the exchange of various currencies for a cryptocurrency or digital asset.Comparable to a generalized financial exchange, a crypto exchange’s core function is to permit and encourage the buying and selling of cryptos.This is accomplished by producing a stable trading environment suitable for traders nested through different locations around the world. Sometimes a crypto exchange may be referred to as a digital currency exchange (DCE) f
Read this Term in
October last year. The US Treasury Department’s Office of Foreign Assets
Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN) had
charged the Seattle-based exchange with violating federal sanctions by
permitting crypto transactions from sanctioned jurisdictions including Iran and
Sudan, between 2014 and late 2017.
In April,
the US Securities
and Exchange Commission also charged Bittrex and
William Shihara, its Founder and former CEO, with the illegal operation of a national securities exchange, broker and clearing agency. It said services offered under the businesses generated about $1.3 billion in revenue for Bittrex. The securities watchdog further accused the exchange of instructing its crypto issuers to evade US securities law.
US Objects to Debt Classification
Meanwhile,
the US government in its opposition to Bittrex’s proposal disapproved
of the exchange’s plan to ‘subordinate certain regulatory claims’ and create
‘classes of customers, general creditors and subordinated creditors’.
“The United
States objects to any subordination of the OFAC and FinCEN Debts and reserves
its rights with respect to other issues of classification of claims,” it wrote
in the court filing.
According
to Bittrex’s court
filing in May, the US branch as of March 27, 2023, served more than 600,000
customers spread across 46 states in the country. Furthermore, the arm holds $250
million and $50 million in customer cryptocurrency and cash, respectively, the exchange’s
attorney Susheel Kirpalani told the bankruptcy court last month, according to a
CoinDesk report.
Ex-CFTC chair joins Circle; Marqeta shuts Aussie office; read today's news nuggets.
The United
States has objected to a proposal by the cryptocurrency exchange Bittrex to return
customer cash and cryptocurrency as part of a process to wind down its operations
in the country. Bittrex’s US arm filed for bankruptcy
protection in May
weeks after exiting the country over regulatory challenges.
In the same
month, the cryptocurrency exchange sought permission from the bankruptcy
Bankruptcy
Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co
Bankruptcy or insolvency constitutes a legal term and refers to being unable to repay debts. A business and a person can declare bankruptcy. When a person or company claims bankruptcy, it is described as a voluntary bankruptcy, and when your debtors force you into bankruptcy, it is referred to as involuntary. A voluntary bankruptcy occurs when the debtor or borrower, the party that owes the money files with the courts. Involuntary bankruptcy happens when your credits file a petition with the co
Read this Term court in Delaware to pay
its customers their crypto holdings in line with terms agreed with customers and to avoid costly litigation. Previously, the exchange argued that courts have permitted payments such as for
critical services before a firm’s bankruptcy plan confirmation hearing.
US Calls Bittrex’s Plan ‘Premature’
However, in
a motion filed
yesterday (Wednesday), the US government countered the proposal, describing it
as ‘premature’ as ‘confirmation is months away’. It noted that if Bittrex
sought to avoid litigation expenses, then it ought to have filed a motion
seeking compromise authority or permission to settle the dispute without going
to trial.
Furthermore,
the government dismissed Bittrex’s argument that courts previously authorized
payments for critical services, noting that the ‘critical vendor’ standard does
not apply to the case.
“This is
not the case here. Instead of reorganizing, the Debtors [Bittrex] intend to
liquidate and shutdown their exchange,” the government’s counsel noted. “The
Debtors shall soon have no business and no future customers, vendors, or
creditors.”
The US
government’s opposition to Bittrex’s proposal for customer withdrawals follows a
violations settlement of $29 million reached with the cryptocurrency exchange
Cryptocurrency Exchange
A cryptocurrency exchange is an online platform that supports the exchange of various currencies for a cryptocurrency or digital asset.Comparable to a generalized financial exchange, a crypto exchange’s core function is to permit and encourage the buying and selling of cryptos.This is accomplished by producing a stable trading environment suitable for traders nested through different locations around the world. Sometimes a crypto exchange may be referred to as a digital currency exchange (DCE) f
A cryptocurrency exchange is an online platform that supports the exchange of various currencies for a cryptocurrency or digital asset.Comparable to a generalized financial exchange, a crypto exchange’s core function is to permit and encourage the buying and selling of cryptos.This is accomplished by producing a stable trading environment suitable for traders nested through different locations around the world. Sometimes a crypto exchange may be referred to as a digital currency exchange (DCE) f
Read this Term in
October last year. The US Treasury Department’s Office of Foreign Assets
Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN) had
charged the Seattle-based exchange with violating federal sanctions by
permitting crypto transactions from sanctioned jurisdictions including Iran and
Sudan, between 2014 and late 2017.
In April,
the US Securities
and Exchange Commission also charged Bittrex and
William Shihara, its Founder and former CEO, with the illegal operation of a national securities exchange, broker and clearing agency. It said services offered under the businesses generated about $1.3 billion in revenue for Bittrex. The securities watchdog further accused the exchange of instructing its crypto issuers to evade US securities law.
US Objects to Debt Classification
Meanwhile,
the US government in its opposition to Bittrex’s proposal disapproved
of the exchange’s plan to ‘subordinate certain regulatory claims’ and create
‘classes of customers, general creditors and subordinated creditors’.
“The United
States objects to any subordination of the OFAC and FinCEN Debts and reserves
its rights with respect to other issues of classification of claims,” it wrote
in the court filing.
According
to Bittrex’s court
filing in May, the US branch as of March 27, 2023, served more than 600,000
customers spread across 46 states in the country. Furthermore, the arm holds $250
million and $50 million in customer cryptocurrency and cash, respectively, the exchange’s
attorney Susheel Kirpalani told the bankruptcy court last month, according to a
CoinDesk report.
Ex-CFTC chair joins Circle; Marqeta shuts Aussie office; read today's news nuggets.