A filing in bankruptcy court from Florida’s Office of Financial Regulation suggested the regulator still had the “administrative discretion” to charge Bittrex.
The Florida Office of Financial Regulation is considering action against United States-based cryptocurrency exchange Bittrex, which filed for Chapter 11 bankruptcy protection in May.
In a July 5 filing with the U.S. Bankruptcy Court for the District of Delaware, Florida Office of Financial Regulation (OFR) assistant general counsel Brandon Greenberg said the state regulator had been given information on Bittrex’s alleged failure to comply with Florida law. According to Greenberg, the OFR still had the “administrative discretion” to charge or not charge Bittrex.
The U.S. Securities and Exchange Commission filed a complaint against Bittrex on April 17, the exchange surrendered its Florida money transmitter license on April 30, and Bittrex filed for bankruptcy on May 8. At the time, the OFR said Bittrex surrendering its license “would not affect our prosecution of the Complaint”, which included allegations that the firm had failed to segregate customer assets with its operating capital, failed to maintain a surety bond, and another complaint which was redacted from the court filing.
Related: Bittrex challenges SEC’s authority in crypto lawsuit, seeks dismissal
The SEC enforcement action, bankruptcy case, and potential lawsuit in Florida came following Bittrex announcing it would wind down operations in the U.S. by April, citing “continued regulatory uncertainty” in the country. The exchange announced on June 15 that certain users could access their accounts and withdraw funds until Aug. 31.
Though the SEC filed separate charges against Bittrex Global in April, the global exchange has largely been unaffected by the regulatory and financial troubles the U.S. exchange faces. The global firm is regulated in Liechtenstein and Bermuda.
Magazine: US enforcement agencies are turning up the heat on crypto-related crime
