SEC Charges Crypto Trading Platform Beaxy and its Executives for Operating an Unregistered Exchange, Broker, and Clearing Agency

Forkast.News is a digital media platform that covers stories about emerging technology at the intersection of business, economy and politics. From crypto, authorities are now looking to enforce rules on public blockchains amid growing interests among banks to use the immutable global database for various business purposes. “Unfortunately, despite our best efforts, it has become clear that the regulatory 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.

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. Without admitting or denying the allegations in the complaint, Windy, Murphy, Abbott, Peterson, and the Braverock Entities have agreed to permanent injunctions prohibiting them from future violations of the securities laws alleged in the complaint and to pay civil penalties. 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. The crypto world was riveted last week by news of the US Commodity Futures Trading Commission’s hard-hitting lawsuit against industry leader Binance — and rightly so.

Beaxy Fees\r\n

On March 29, 2023, the Securities and Exchange Commission charged the crypto asset trading platform beaxy.com (the Beaxy Platform) 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 (BXY) 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. The Securities and Exchange Commission today charged the crypto asset trading platform beaxy.com (the Beaxy Platform) and its executives for failing to register as a national securities exchange, broker, and clearing agency.

The SEC also said it was charging Beaxy founder Artak Hamazaspyan and Beaxy Digital, a company he controls, with raising $8 million through an unregistered offering of the Beaxy token (BXY) and the misappropriation by Hamazaspyan of $900,000 of investor funds for personal uses. 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. Launched on 10 June 2019, Beaxy Exchange is a centralized exchange headquartered at The Board of Trade in Chicago, Illinois. The exchange supports 6 fiat pairs, a two-way fiat ramp, credit and debit card purchases, and spot cryptocurrency trading. Cryptocurrencies are reportedly secured by Curv institutional custody and fiat accounts are insured up to $250,000.

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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. The SEC charged Beaxy with raising $8 million through the unregistered offering of its native token, BXY. The regulator also alleges that the exchange’s founder, Artak Hamazaspyan, used $900,000 for personal use, including gambling. In its lawsuit, filed Wednesday at the Northern District of Illinois, the securities regulator also accused the platform of failing to register as a broker and a clearing agency.

Regular basis to the cryptocurrency space for the first time, assembling them under one roof for crypto-traders to have at their fingertips and use at their disposal. Beaxy leverages startegic partnerships with market leaders from the traditional financial world to deliver the best in class platform to our users. “We forthrightly committed to cooperation with the Securities and Exchange Commission for over two years, continually providing information, data and interviews to assist regulators in whatever manner we could,” Beaxy said. 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. Another man, Brian Peterson, was accused of acting as an unregistered dealer by providing marketing services to Beaxy.

Other Centralized Exchanges

On March 23, the SEC also warned against investing in crypto assets securities. They reasoned with price volatility and lack of investor protection. The agency served Coinbase with a Wells Notice and sued Justin Sun for offering BTT and TRX as unregistered securities. 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.“ The SEC said in its statement that it had obtained consent decrees from Windy Inc., Murphy, Abbott and Peterson that obligate them to cease all exchange activities, close down the Beaxy platform, provide accounting records, return customer assets and funds and destroy any BXY in Windy Inc.’s possession. By doing so, the complaint alleges that Peterson and the Braverock Entities acted as unregistered dealers in violation of Section 15(a) of the Exchange Act.

Most traders in the crypto world today carry out their trades via desktop (around 70% or so). However, there are naturally people out https://traderoom.info/how-to-trade-support-and-resistance/ there that want to do it from their smart phone as well. If you’re one of those people, then this platform can still be for you.

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Securities and Exchange Commission (SEC) 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 (BXY), 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. Beaxy suspended operations on March 28 “due to the uncertain regulatory environment surrounding our business,” according to the cryptocurrency exchange’s blog. The suspension came a day before the United States Securities and Exchange Commission announced it was charging Beaxy and its executives with failing to register as a national securities exchange, broker and clearing agency.

• The agency served Coinbase with a Wells Notice and sued Justin Sun for offering BTT and TRX as unregistered securities.
• 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.
• On March 29, 2023, the Securities and Exchange Commission charged the crypto asset trading platform beaxy.com (the Beaxy Platform) and its executives for failing to register as a national securities exchange, broker, and clearing agency.
• “Unfortunately, despite our best efforts, it has become clear that the regulatory environment is just too uncertain to continue operations,” Beaxy stated.

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But a case filed by the Securities and Exchange Commission just a few days later against a much smaller player whose name also starts with a “B” could also have big ramifications for the digital-asset space.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. 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 world’s largest cryptocurrency exchange, Binance, and its chief executive Changpeng Zhao were sued by the Commodity Futures Trading Commission earlier this week for “willful evasion of US law.” Kraken, another crypto exchange, settled with the SEC last month after being accused of not registering under securities laws.