Zephyrnet Logo

SEC charges Beaxy cryptocurrency platform for violating securities laws

Date:

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. As of publication time, Beaxy.com has ceased operations.

Fast facts

  • The SEC alleged that market makers on the Beaxy Platform were operating as unregistered dealers.
  • The SEC claimed that Beaxy violated the Securities Exchange Act of 1934 because it brought together the orders for securities of multiple buyers and sellers using established non-discretionary methods under which such orders interacted.
  • 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.
  • Windy, a company managed by Nicholas Murphy and Randolph Bay Abbott, provided the Beaxy Platform as a web-based trading platform that facilitated buying and selling of crypto assets that were offered and sold as securities.
  • 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.
  • It is the third crypto exchange to be targeted by a U.S. federal agency in less than two weeks.

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.

spot_img

Latest Intelligence

spot_img