The Securities and Exchange Commission recently took action against crypto exchange ShapeShift, issuing a cease-and-desist order that prohibits the platform from operating as an unregistered dealer in the U.S. for listing crypto securities. ShapeShift, known for its wide range of crypto assets offered to customers, has agreed to settle the charges brought against it by the SEC.
In the filing, the SEC highlighted ShapeShift’s past operations as an unregistered dealer for cryptocurrencies considered securities prior to 2021. The exchange, based in Denver, Colorado, ceased its U.S. operations and agreed to a settlement that includes a $275,000 fine and a commitment to comply with the Securities Exchange Act moving forward.
While the SEC did not specify which crypto assets were considered securities, it pointed out that ShapeShift engaged in buying and selling crypto assets from its own accounts, aligning with the definition of an unregistered dealer. This action is reminiscent of similar accusations levied against other U.S. exchanges like Coinbase, Kraken, and Binance.US by the SEC.
ShapeShift’s decision to close its U.S. exchange in 2021 signals its compliance with regulatory requirements. It should be noted that the findings in the cease-and-desist order are specific to ShapeShift and do not have implications for other entities. Both the SEC representatives and ShapeShift’s founder, Erik Voorhees, have yet to provide further comments on the matter.
