Bittrex enters settlement with SEC, agrees to pay out $24 million

By Sarah Lizee

Olympia, Wash., Aug. 14 – Desolation Holdings LLC, which does business as Bittrex, has resolved the Securities and Exchange Commission’s $1.3 billion enforcement action for $24 million through a settlement, according to a press release issued Friday.

The SEC had alleged that Bittrex and its co-founder and former chief executive officer, William Shihara, operated an unregistered national securities exchange, broker and clearing agency.

“Having announced that it would cease operations in the United States before the SEC filed its complaint, the company determined that it was in its best interest to avoid costly and protracted litigation that could cause significant delay to the conclusion of the Chapter 11 bankruptcy process,” the company said in the release.

The company noted that the SEC’s complaint didn’t allege that any Bittrex customer suffered financial harm. Bittrex said it expects all remaining customer claims to be paid fully in the Chapter 11 process.

“The settlement, which was for a fraction of the money that SEC staff demanded before they filed their case, is on a neither admit nor deny basis,” Bittrex said.

The settlement also resolves the action against foreign affiliate Bittrex Global, allowing it to continue operating without any interruption of its business.

“We are disappointed that where we agreed neither to admit nor deny the allegations in the complaint, a term we are honoring, the SEC has decided to issue a press release contrary to the spirit of the settlement,” Bittrex said, referring to a release issued Thursday by the SEC.

“It is telling that the SEC decided to settle this matter instead of addressing the arguments made in the defendants’ motions to dismiss, which is now withdrawn under the terms of the settlement, but still available on the public docket.”

Bittrex is a cryptocurrency trading platform with headquarters in Seattle. The company filed bankruptcy on May 8 in the U.S. Bankruptcy Court for the District of Delaware under Chapter 11 case number 23-10597.

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