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Bittrex US files for Chapter 11 Bankruptcy

Bittrex US files for Chapter 11 Bankruptcy

  • Bittrex has filed for bankruptcy just over a month after the SEC filed a lawsuit against it.
  • The exchange has listed liabilities and assets totalling $1 billion apiece.
  • The development comes days after Bittrex US informed its users to withdraw funds.

Bittrex cryptocurrency exchange has officially filed for Chapter 11 bankruptcy protection in the US. The bankruptcy filing comes barely a month after the US Securities and Exchange Commission (SEC) charged Bittrex for repeatedly breaking the security regulations in the country.

In the Bankruptcy filing submitted on May 8 to the United States Bankruptcy Court for the District of Delaware, Bittrex reported that it has $500 million to $1 billion in assets, $500 to $1 billion in liabilities and more than 100,000 creditors.

The bankruptcy protection filing will be Seattle-based Bittrex and its two entities in Malta and a related entity Desolation Holdingd LLC. It does not involve the Liechtenstein-based global trading exchange firm Bittrex Global GmbH. The bankruptcy filing only applies to Bittrex US and its affiliates.

SEC’s lawsuit against Bittrex

The US SEC last month filed a lawsuit against Bittrex in the Federal court alleging that the exchange violates violated the securities regulations from 2017 through to 2022 generating at least $1.3 billion in revenue.

The SEC alleges that Bittrex occasionally operated as an exchange, brokerage, and clearing agency without having filed the necessary paperwork. The lawsuit also classifies three tokens (ALGO, OMG, and DASH) in specific as unregistered securities.

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