The Bittrex cryptocurrency trading platform has filed for Chapter 11 bankruptcy protection in the District of Delaware.
In a May 8 filing in the United States Bankruptcy Court for the District of Delaware, Bittrex estimated that it had more than 100,000 creditors, between $500 million and $1 billion in assets, and between $500 million and $1 billion in liabilities as part of bankruptcy proceedings.
The bankruptcy covers his Seattle-based entity, Bittrex, Inc, two Bittrex entities in Malta, and an affiliated entity, Desolation Holdings LLC. Bittrex Global GmbH, the Liechtenstein-based global exchange entity, was not included in the filing.
The statement followed the US Securities and Exchange Commission (SEC) charging the company and its co-founder and former CEO William Shihara for securities violations in April.
The SEC claimed that Bittrex, Inc and Bittrex Global operated an unregistered stock exchange. In October, the exchange also charges received related to violations of the Bank Secrecy Act by the US Treasury's Office of Foreign Assets Control (OFAC) and Financial Crimes Enforcement Network (FinCEN) and agreed to pay about $29 million in a settlement .
OFAC is the largest creditor listed in Bittrex's bankruptcy filing, and the exchange registered a claim of $24.2 million for the Office. His next biggest creditor is a crypto wallet with a claim of $14.5 million.
FinCEN is also listed in the top 50 creditors with a $3.5 million claim, the SEC is listed with an unknown number of claims.
The SEC's enforcement actions and its recent bankruptcy filing come as Bittrex announced in March that it close its operations in the US by April 30 citing "continued regulatory uncertainty" in the country.
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It has been a rough year for the US Bittrex entity in 2023. The exchange also cut 83 employees in February citing the crypto market at the center caused by the crashes and bankruptcies of other crypto companies.
Bittrex's bankruptcy is the latest in a line of other cryptocurrency exchange or lending platforms that also recently filed for Chapter 11 protection, including FTX, BlockFi, Celsius and Voyager Digital.
Cointelegraph reached out to Bittrex Global CEO Oliver Lynch for comment but did not immediately receive a response.
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Update (May 8, 10:50 pm UTC): This article has been updated with additional information on the bankruptcy filing and more background.
Additional reporting by Jesse Coghlan.
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