Bittrex’s arguments are very similar to those presented by Coinbase. The United States Securities and Exchange Commission (SEC) and cryptocurrency exchange Bittrex are engaged in a legal dispute. Bittrex has filed a move to dismiss the case. The SEC does not have the ability to regulate cryptocurrencies as securities lacking express permission from Congress, according to Bittrex’s recent court filing. This claim contests the SEC’s interpretation of current securities laws and aims to create a more clear regulatory framework that takes into account digital assets.
Bittrex has taken a similar stance to Coinbase in its request to dismiss, closely aligning its arguments with those of the larger cryptocurrency exchange. This alignment suggests a calculated move by Bittrex to take advantage of the strong legal foundation created by Coinbase and create a cohesive defense against the SEC’s complaint.
Similar to Coinbase, Bittrex’s legal team points out areas where they believe the SEC’s claims about the trading of investment contracts fall short. While both defendants agree that some crypto assets’ original sales may be categorized as securities contracts, they argue that this classification does not apply to assets traded on secondary markets. They contend that once an asset is released and actively traded on secondary markets, it should no longer be classified as a security but rather as a commodity or another type of digital asset.
Furthermore, Bittrex argues that the SEC failed to fully inform it that its conduct were illegal, highlighting a typical line of defense used by cryptocurrency defendants in opposition to the SEC’s accusations.
The SEC accused Bittrex and co-founder William Shihara of operating an unlicensed national securities exchange in April. The complaint claims that without acquiring SEC registration as an exchange, Bittrex allowed the trading of digital assets that complied with the requirements for securities set forth in U.S. federal securities laws.The SEC also accused Bittrex Global, a foreign affiliate of Bittrex, of failing to register as a national securities exchange in the same lawsuit.