The SEC alleges that when Windy Inc. took over the platform from Hamazaspyan in 2019, the new managers continued using beaxy for trading crypto assets “that were offered and sold as securities” and in turn violated securities law. Reuters, the news and media division of Thomson Reuters, is the world’s largest multimedia news provider, reaching billions of people worldwide every day. Reuters provides business, financial, national and international news to professionals via desktop terminals, the world’s media organizations, industry events and directly to consumers. “Given this filing, and the fact that the SEC has reportedly issued a Wells notice to Coinbase, it is likely that this is a harbinger of additional actions with respect to exchanges and similar entities,” said Howard Fischer, a former SEC lawyer and a partner at law firm Moses & Singer.
- The charges filed in Chicago federal court expand a crackdown by U.S. prosecutors and regulators on alleged abuses in the digital asset industry.
- Wednesday’s SEC action included charges against Windy Inc and its principals Nicholas Murphy and Randolph Bay Abbott for operating through Beaxy’s platform without being registered.
- On Monday, the Commodity Futures Trading Commission sued Binance, accusing the world’s largest crypto exchange of violating rules preventing illegal activity.
- The SEC alleges Beaxy founder Artak Hamazaspyan illegally raised $8 million in an unregistered offering of its Beaxy token.
The SEC accused a Chicago-based firm behind Beaxy and some affiliates of serving in various roles such as an exchange, broker and clearing agency without registering with the SEC. That structure, which is common throughout the crypto industry, is one that the SEC’s chair has criticized for conflicts of interest and risks to investors. Windy and its current managers agreed to pay $79,200 in civil penalties but did not admit to or deny the SEC’s allegations, the agency said, but the SEC is still litigating securities fraud charges filed against Hamazaspyan. The next day, prosecutors in New York added a Chinese bribery charge to their fraud case against Sam Bankman-Fried, who founded the now-bankrupt crypto exchange FTX. On Monday, the Commodity Futures Trading Commission sued Binance, accusing the world’s largest crypto exchange of violating rules preventing illegal activity. The charges filed in Chicago federal court expand a crackdown by U.S. prosecutors and regulators on alleged abuses in the digital asset industry.
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It also charged founder Artak Hamazaspyan with raising $8 million in an unregistered offering of the token BXY and misappropriating at least $900,000 for gambling and other personal use. Wednesday’s SEC action included charges against Windy Inc and its principals Nicholas Murphy and Randolph Bay Abbott for operating through Beaxy’s platform without being registered. “This case serves as yet another reminder to crypto intermediaries that their business models must comply and adapt to the law, not the other way around,” SEC Chair Gary Gensler said in a statement. Coinbase Global Inc is also in the SEC’s sights, saying on March 22 the regulator had found potential securities law violations and might sue. The SEC alleges Beaxy founder Artak Hamazaspyan illegally raised $8 million in an unregistered offering of its Beaxy token. She has received awards for her work from the Society for Advancing Business Editing and Writing and the Newswomen’s Club of New York.
- Windy and its current managers agreed to pay $79,200 in civil penalties but did not admit to or deny the SEC’s allegations, the agency said, but the SEC is still litigating securities fraud charges filed against Hamazaspyan.
- She has received awards for her work from the Society for Advancing Business Editing and Writing and the Newswomen’s Club of New York.
- “This case serves as yet another reminder to crypto intermediaries that their business models must comply and adapt to the law, not the other way around,” SEC Chair Gary Gensler said in a statement.
- The SEC alleges that when Windy Inc. took over the platform from Hamazaspyan in 2019, the new managers continued using Beaxy for trading crypto assets “that were offered and sold as securities” and in turn violated securities law.
In the past few months, a number of crypto firms have been hit with civil lawsuits, as U.S. regulators crack down on the budding industry. The Securities and Exchange Commission charged cryptocurrency trading platform Beaxy on Wednesday for failing to register as a securities exchange, and alleged the company’s founder misappropriated customer money, leading Beaxy to shut down—the latest crypto firm to be swept up in a broad crackdown by U.S. regulators. Wednesday’s civil charges came one day after Beaxy said it would immediately suspend services, saying that “due to the uncertain regulatory environment surrounding our business, we have made the difficult decision to cease operations.” Beaxy suspended services on its exchange and ceased operations “due to the uncertain regulatory environment surrounding our business,” the company said on its website—the SEC said in a statement Beaxy agreed to shut down the platform.
Crypto Exchange Beaxy Shuts Down Amid SEC Charges
Another man, Brian Peterson, was accused of acting as an unregistered dealer by providing marketing services to Beaxy.
