Beaxy exchange is yet another victim of the intense scrutiny of crypto firms by the US financial regulators after getting sued by the US Securities and Exchange Commission on March 27.
The decision to suspend operations was disclosed in a blog post by the exchange on March 28 where the firm cited the uncertain regulatory environment surrounding its business.
Furthermore, Beaxy urged all users to ensure their assets are withdrawn from the platform within 30 days following the announcement.
“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. Unfortunately, despite our best efforts, it has become clear that the regulatory environment is just too uncertain to continue operations,” Beaxy exchange wrote in the blog post while commenting on why it is ceasing operations.
SEC Lawsuit
On Monday, the US financial regulators sued Beaxy exchange for alleged failure to register as a national securities exchange, broker, and clearing agency in the US.
In addition to the above suit, regulators also charged Beaxy exchange co-founder Artak Hamazaspyan along with a company he controls known as Beaxy Digital with raising $8 million via unregistered securities as well as the misappropriation of investors’ funds by Hamazaspyan. Also, the agency, amongst other cases was accused of charging market makers operating on the Beaxy platform as unregistered dealers.
SEC chair Gary Gensler while commenting on the suit said:
“We allege that Beaxy and its affiliates performed the functions of an exchange, broker, clearing agency, and dealer without registering with the Commission and complying with clear, time-tested rules governing those activities.”
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