Bittrex challenges SEC authority

Bittrex filed a motion to dismiss the case brought by the SEC. In the company’s view, the agency lacks the authority to regulate cryptocurrencies without congressional authorization.

This statement casts doubt on the SEC’s interpretation of existing rules for digital assets and is aimed at “creating a clearer regulatory framework” for the industry.

Bittrex followed the example of Coinbase and adopted a similar approach, closely aligning its arguments with those of the larger platform.

Both defendants acknowledge that the initial sale of certain cryptocurrencies may be classified as a securities transaction, but that same definition does not apply to assets traded on secondary markets. In that case, the coin should be treated as a commodity.

According to representatives of Bittrex, the SEC did not properly announce that its actions regarding digital assets had not been approved by Congress.

Back in April, the regulator filed a suit against the company; Chief Counsel David Maria commented to WSJ that the firm was already preparing to wind down operations in the United States after receiving the regulator’s notice.

Back in May, the exchange filed for insolvency in the United States. According to filings, the company’s assets and liabilities total between $500 million and $1 billion. The number of creditors exceeds 100,000. The platform says it holds the assets of American customers who had not withdrawn them by April 30.

In June, the court allowed Bittrex to enable withdrawals for users.