The U.S. Securities Exchange Commission (SEC) has brought charges against crypto trading platform Beaxy and its staff. In addition, the regulator claimed that the cryptocurrency exchange’s founder raised $8 million in an unregistered crypto token offering “illegally using at least $900,000 for personal matters, including gambling.”
SEC Files Complaints Against Crypto Exchange Platform Beaxy
The U.S. Securities and Exchange Commission (SEC) announced Wednesday that it has filed complaints against the crypto asset trading platform Beaxy, its founder and its executives. SEC Chairman Gary Gensler commented:
We allege that Beaxy, its affiliates and the exchange performed the functions of a broker, clearing agency and dealer without having to register with the Commission respecting the clear and time-tested rules that govern these activities.
Aside from alleging that Beaxy, its executives neglected to register as a national securities exchange, broker, and clearing agency, the securities watchdog stated that it has “charged the founder of the platform, Artak Hamazaspyan, and a company he controlled, Beaxy Digital Ltd., with raising $8 million in an unregistered offering of the Beaxy token (BXY).”
The SEC “charged that Hamazaspyan had misappropriated at least $900,000 for personal use, including gambling.” The regulator also “charged market makers operating on the Beaxy Platform as unregistered dealers.”
In addition, the SEC noted that Randolph Bay Abbot and Nicholas Murphy, who had been working on the Beaxy Platform since October 2019 through their company Windy Inc., had convinced Hamazaspyan that following the BXY offering, he should resign.
Beaxy Shuts Down Services
Following the SEC enforcement action, Beaxy announced on its website: “Regrettably, we are announcing the immediate suspension of services on Beaxy Exchange. Due to the uncertain regulatory environment surrounding our business, we have made the difficult decision to cease operations.”
While stressing, “We forthrightly committed to cooperation with the Securities and Exchange Commission (SEC) for over two years, continually providing information, data, and interviews to assist regulators in whatever manner we could,” the company stated:
Unfortunately, despite our best efforts, it is clear that the regulatory environment makes it impossible to continue operations.
What action do you think the SEC should take against this cryptocurrency exchange, its founder and its executives? Let us know what you think in the comments below.
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