Beaxy crypto exchange shuts down amid SEC allegations of misconduct

Beaxy, a cryptocurrency exchange platform, announced on Monday that it will cease its operations and refund its customers after being sued by the U.S. Securities and Exchange Commission (SEC) for allegedly violating securities laws.

The SEC accused Beaxy of offering and selling unregistered securities in the form of digital tokens called BXY, which were supposed to give investors a share of the exchange’s profits and governance rights. The SEC also alleged that Beaxy misled investors about its regulatory compliance, security measures, and trading volume.

Beaxy said in a statement that it cooperated with the SEC’s investigation and decided to settle the charges without admitting or denying any wrongdoing. The exchange agreed to pay a civil penalty of $8 million and to return all the funds raised from the BXY token sale, which amounted to about $15 million.

Today we charged the crypto asset trading platform https://t.co/ykFkM2s0wY and its executives for failing to register as a national securities exchange, broker, and clearing agency, and we charged market makers operating on the Beaxy Platform as unregistered dealers.

— U.S. Securities and Exchange Commission (@SECGov) March 29, 2023

Beaxy apologized to its customers and partners for the inconvenience and said it will process all withdrawal requests within 30 days. The exchange also advised its users to remove any funds from their Beaxy wallets as soon as possible, as the platform will be permanently shut down after that period.

Beaxy’s shutdown is another blow to the cryptocurrency industry, which has faced increased scrutiny and regulation from authorities worldwide.

The SEC has been cracking down on unregistered token offerings and exchanges, claiming they pose significant risks to investors and market integrity.

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