Crypto Exchange Beaxy Shut Down After SEC Lawsuit

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I strongly suspect – and I’m guessing I’m not the only one – that this may be a preview of how the SEC’s case against other crypto exchanges may go. Launched on 10 Jun 2019, Beaxy Exchange is a centralized exchange, headquartered in The Board of Trade in Chicago, IL. The exchange claims to support 6 fiat pairs, a two-way fiat ramp, credit and debit card support, and spot cryptocurrency trading. Cryptocurrencies are reportedly secured by Curv institutional custody and fiat accounts are insured up to $250,000.

Was regularly engaged in the business of effecting transactions for the account of others in crypto assets that were offered and sold as securities, and thus should have registered as a broker. 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. In its lawsuit,filedWednesday at the Northern District of Illinois, the securities regulator also accused the platform of failing to register as a broker and a clearing agency.

Market Makers Separately Charged as Unregistered Dealers

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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. Adani Group executives met US investors, including BlackRock, Blackstone and Pacific Investment Management, as part of its plans to market privately placed bonds for some of its group companies, according to a report from The Economic Times. The conglomerate, led by billionaire Gautam Adani, is aiming to raise up to $1 bn in two tranches this year via such a route, said people with knowledge of the matter who declined to be named as they were not authorized to speak about it. The meetings were part of a global roadshow that reached US cities including New York, Boston, Los Angeles and San Francisco, as Adani sought to reassure international investors that the ports-to-power empire’s finances are under control. As much as $153 bn in combined market value was erased from company stocks following a January short-seller’s report. OneMarketData, LLC, a tick data management and analytics provider, announced that Beaxy, the all-in-one cryptocurrency exchange has exclusively built their matching engine on OneTick, OneMarketDatas flagship high performance analytics and data management platform.

Empowering issuers with analytics and insights

As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. According to the complaint, Beaxy carried out the functions one might expect a national securities exchange, a broker and a clearing agency all would carry out despite not registering as any of these with the regulator. Among its allegations, the SEC said Beaxy operated as an unregistered exchange, a broker and a clearing agency.

On March 29, 2023, the Securities and Exchange Commission charged the crypto asset trading platform beaxy.com and its executives for failing to register as a national securities exchange, broker, and clearing agency. The SEC also 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 and alleged that Hamazaspyan misappropriated at least $900,000 for personal use, including gambling. Finally, the SEC charged market makers operating on the Beaxy Platform as unregistered dealers.

Bank of England braces for widespread use of tokenization

“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. Lee’s proposals were voted down at the company’s general meeting earlier this week after failing to win over other shareholders, but he is not giving up. It doesn’t look like Beaxy or its executives settled the charges with the SEC, but the fact the exchange is shutting down suggests this will be the kind of case the SEC may look to for a potentially easy win ahead of the Coinbase lawsuit. Beaxy, for its part, claimed an “uncertain regulatory environment” as the reason for its shutdown ahead of the lawsuit’s publication. The Securities and Exchange Commission also accused the exchange’s founder of misappropriating customer money. Complaint alleging a $1.5 million investment fraud regarding crypto tokens issued by Saint Kitts and Nevis-domiciled Beaxy Digital Ltd. in the U.S.

On Monday, the Commodity Futures Trading Commission sued Binance, accusing the world’s largest crypto exchange of violating rules preventing illegal activity. “We strongly advise you to withdraw any remaining assets within 30 days to avoid unnecessary complications and delays,” the exchange told its users. This absolutely reads like a playbook for how the SEC could sue Coinbase, if that situation doesn’t resolve with a settlement or non-action. So far all Coinbase has said is that the notice lists “an undefined” number of its listed cryptocurrencies, and that its Earn, Prime and Wallet products potentially violate securities law. You’re reading State of Crypto, a CoinDesk newsletter looking at the intersection of cryptocurrency and government. The percentage of Binance customers who increased or decreased their net position in BTC over the past 24 hours through trading.

The https://traderoom.info/ price page is just one in Crypto.com Price Index that features price history, price ticker, market cap, and live charts for the top cryptocurrencies. Learn more about Consensus 2023, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. Customers of the exchange will be able to withdraw their assets within 24 hours after all user orders are canceled and balances are verified and are encouraged to do so within 30 days, the SEC said. Helene is a U.S. markets reporter at CoinDesk, covering the US economy, the Fed, and bitcoin. She is a recent graduate of New York University’s business and economic reporting program. Forkast.News is a digital media platform that covers stories about emerging technology at the intersection of business, economy and politics.

Access unmatched financial data, news and content in a highly-customised workflow experience on desktop, web and mobile. “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. Check out CoinGeek’sBitcoin for Beginnerssection, the ultimate resource guide to learn more about Bitcoin—as originally envisioned by Satoshi Nakamoto—and blockchain.

“Unfortunately, despite our best efforts, it has become clear that the beaxy environment is just too uncertain to continue operations,” Beaxy stated. The exchange claimed it would make all funds available for withdrawal in 24 hours after canceling all orders and verifying balances. If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at or find me on Twitter @nikhileshde. Trade Bitcoin and over 30 other cryptocurrencies on Beaxy, a U.S. exchange with a personalized approach. Please also note that data relating to the above-mentioned cryptocurrency presented here are based on third party sources.

Specifically, Windy, Abbott, and Murphy agreed to pay a total of $79,200 in civil penalties; Peterson agreed to pay a civil penalty of $6,600; and the Braverock Entities agreed to jointly and severally pay a penalty of $80,000. In addition, Windy agreed to pay $10,779 in disgorgement plus prejudgment interest, and the Braverock Entities agreed to jointly and severally pay $52,000 in disgorgement plus prejudgment interest. The penalty amounts reflect the cooperation the staff received from the settling parties during the investigation. Beaxy allegedly acted as an intermediary in making payments and deliveries upon matching sell and buy orders, maintained custody of customer assets, and should have registered as a clearing agency. The charges filed in Chicago federal court expand a crackdown by U.S. prosecutors and regulators on alleged abuses in the digital asset industry.

The Securities and Exchange Commission also accused the exchange’s founder of misappropriating customer money.

The changes mean that only 0.2 percent of funds will have a AAA rating in the future, compared with roughly 20 percent now, according to MSCI estimates. The measures include giving managers of swap-based ETFs six months to provide data on their underlying index constituents, which MSCI will start using to generate ESG scores instead of collateral, it said. We wanted to increase the sophistication level of our analysis and approach. OneMarketData enables Beaxy to provide notable features including advanced order types, several wallets per currency, multiple users on a single account with various levels of permission, tax-ready reports, 24/7 customer support, in-exchange TradingView charting and a Security Token Offering launch platform.

The SEC’s charges against Beaxy and its executives raise serious concerns about the transparency and accountability of cryptocurrency exchanges. As regulators continue to scrutinize the crypto industry, more exchanges and other crypto-related companies may face legal issues if they fail to comply with regulations designed to protect investors. Companies must ensure that their business models comply with the law and prioritize the protection of investors. Securities and Exchange Commission charged the company and its founder, Artak Hamazaspyan. With operating an unregistered exchange and brokerage, the agency said Wednesday in a statement.

• The SEC’s complaint against this other “B” — Beaxy.com— flew somewhat under the radar.
• This partnership will allow faster transactions, unique and advanced order types and an overall smoother flow in order books.
• Beaxy, for its part, claimed an “uncertain regulatory environment” as the reason for its shutdown ahead of the lawsuit’s publication.
• Beaxy allegedly acted as an intermediary in making payments and deliveries upon matching sell and buy orders, maintained custody of customer assets, and should have registered as a clearing agency.
• The next few paragraphs then contrasted Beaxy with the traditional securities world, noting that a national securities exchange would not “take possession or control” of an asset being traded, while clearing agencies handle settlement and broker-dealers.

Securities and Exchange Commission has charged crypto asset trading platform Beaxy.com and its executives for failing to register as a national securities exchange, broker, and clearing agency. The company’s founder, Artak Hamazaspyan, and a company he controlled, Beaxy Digital, were also charged with raising $8 million in an unregistered offering of Beaxy tokens , with Hamazaspyan misappropriating at least USD $900,000 for personal use. Windy Inc. took over the platform in 2019 after the founder misappropriated money, according to the SEC, and managers Nicholas Murphy and Randolph Bay Abbott maintained Beaxy for trading crypto assets “that were offered and sold as securities,” the SEC said. So the agency is also accusing them of violating securities law by operating an unregistered exchange, broker and clearing agency, though the platform was described as defunct in another SEC case last year. Windy took over the platform in 2019 after the founder misappropriated money, according to the SEC.

The SEC’s complaint against this other “B” — Beaxy.com— flew somewhat under the radar. But it was the first time the agency sued a crypto platform for simultaneously operating an unregistered exchange, brokerage and clearing business – a problem that SEC Chair Gary Gensler has repeatedly said is rampant in the sector and poses a conflict of interest. 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. The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups.

It further charged founder Artak Hamazaspyan with conducting an unregistered offering in which he raised $8 million from selling Beaxy tokens . Hamazaspyan also allegedly misappropriated at least $900,000 for personal use, including gambling. As the trading industry evolves, we are excited to offer a unique matching engine to a cryptocurrency exchange, said Ross Dubin, SVP Global Head of Sales, OneMarketData. Beaxy is growing at an exponential rate and we are pleased to be able to offer our support at a pivotal time for the company. The lawsuit also pulled in Brian Peterson, who allegedly provided market-making services for Beaxy through his companies Braverock Investments LLC and Future Digital Markets Inc.

This partnership will allow faster transactions, unique and advanced order types and an overall smoother flow in order books. Beaxy and its affiliates allegedly 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. 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.

Launching a CBDC would open a pathway for Jordan to improve its domestic payment systems, but the IMF warned that the country should tread carefully to avoid potential financial repercussions. Acknowledging the rising popularity and adoption of tokenization, BoE’s John Cunliffe says the central bank is looking into the possibility of imposing limitations on stablecoins to mitigate risks. The most used employees email address of Beaxy is , being used 100% of the time.

The total dollar value of all transactions for this asset over the past 24 hours. Hamazaspyan also allegedly misappropriated at least $900,000 for personal use, including gambling, the SEC said.

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Beaxy Exchange offers prebuilt TA, signals, for cryptocurrencies listed on their platform. Members of their team have reportedly built trading desks in Chicago, IL. Their API feature REST and WebSocket as well as FIX, view the documentation here. By doing so, the complaint alleges that Peterson and the Braverock Entities acted as unregistered dealers in violation of Section 15 of the Exchange Act. 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.”

Managers Nicholas Murphy and Randolph Bay Abbott maintained Beaxy for trading crypto assets ‘that were offered and sold as securities,’ the SEC said. The agency is also accusing them of violating securities law by operating an unregistered exchange, brokerage and clearing agency, though the platform was described as defunct in another SEC case last year. The SEC has charged crypto trading platform Beaxy for not registering as a national securities exchange, broker or clearing agency. It also alleges that Beaxy founder Artak Hamazaspyan raised $8 million in an unregistered offering of the Beaxy token and used at least $900,000 for personal use. The U.S. Securities and Exchange Commission filed a lawsuit against crypto exchange Beaxy last week, alleging it offered an unregistered securities sale through a 2018 initial coin offering, and that it operated as an unregistered securities exchange, broker-dealer and clearing agency.

Securities and Exchange Commission v. Chicago Crypto Capital LLC, Brian B. Amoah, Darcas Oliver Young, and Elbert G. Elliott at the U.S. Browse an unrivalled portfolio of real-time and historical market data and insights from worldwide sources and experts. 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. 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.