In the past few months, a number of crypto firms have been hit with civil lawsuits, as U.S. regulators crack down on the budding industry. The world’s largest cryptocurrency exchange, Binance, and its chief executive Changpeng Zhao were sued by the Commodity Futures Trading Commission earlier this week for “willful evasion of US law.” Kraken, another crypto exchange, settled with the SEC last month after being accused of not registering under securities laws. Most notably, cryptocurrency giant FTX collapsed last year and its founder Sam Bankman-Fried was charged with fraud. The SEC alleges that when Windy Inc. took over the platform from Hamazaspyan in 2019, the new managers continued using beaxy for trading crypto assets “that were offered and sold as securities” and in turn violated securities law.

The lawsuit also pulled in Brian Peterson, who allegedly provided market-making services for Beaxy through his companies Braverock Investments LLC and Future Digital Markets Inc. Among its allegations, the SEC said Beaxy operated as an unregistered exchange, a broker and a clearing agency. I strongly suspect – and I’m guessing I’m not the only one – that this may be a preview of how the SEC’s case against other crypto exchanges (cough) may go.

• The U.S. Securities and Exchange Commission (SEC) filed charges against crypto exchange Beaxy last week, resulting in the exchange shuttering its doors after the regulator alleged it raised $8 million in an unregistered securities offering and that the company’s founder “misappropriated” nearly $1 million for personal use.
• “Unfortunately, despite our best efforts, it has become clear that the regulatory environment is just too uncertain to continue operations,” Beaxy stated.
• If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at or find me on Twitter @nikhileshde.
• I strongly suspect – and I’m guessing I’m not the only one – that this may be a preview of how the SEC’s case against other crypto exchanges (cough) may go.
• According to an official press release, the SEC alleges that Beaxy operated without registering as a national securities exchange, broker, or clearing agency.

Hamazaspyan also allegedly misappropriated at least $900,000 for personal use, including gambling. “The Beaxy Platform also had the ability to trade crypto asset securities against its own customers, which gives it the means and the motive to put itself on the winning side of each trade, without regard to obligations that apply to registered broker-dealers,” the filing said. The Beaxy executives agreed to cease the operations without admitting or denying the allegation.

Previously, Mr. Redbord served as a Senior Assistant United States Attorney for the District of Columbia, where he investigated and prosecuted cases related to cryptocurrency, terrorist financing, sanctions evasion, export control, child exploitation and human trafficking. He has received numerous awards from FinCEN, the FBI, and the United States Attorney’s Office, including the Attorney General’s Award for leading an interagency task force dedicated to prosecuting those who abuse and exploit children. The U.S. Securities and Exchange Commission (SEC) has filed a lawsuit against the Beaxy exchange, shutting down its operations. He was previously Vice President of Business Development at SunGard Financial Systems (now FIS) heading up strategic, business planning and product development across Asia, Africa, Latin America and the Middle East, in total overseeing 36 countries. He was also involved in several significant research programmes, including one assisting on TARP in 2008 for the US Treasury Department and the World Bank. This absolutely reads like a playbook for how the SEC could sue Coinbase, if that situation doesn’t resolve with a settlement or non-action.

But a case filed by the Securities and Exchange Commission just a few days later against a much smaller player whose name also starts with a “B” could also have big ramifications for the digital-asset space.The SEC’s complaint against this other “B” — Beaxy.com — flew somewhat under the radar. But it was the first time the agency sued a crypto platform for simultaneously operating an unregistered exchange, brokerage and clearing business – a problem that SEC Chair Gary Gensler has repeatedly said is rampant in the sector and poses a conflict of interest. Mr Ken Nagatsuka is the Executive Director and Head of Payments Department at the Monetary Authority of Singapore (MAS). The department is responsible for the authorisation, ongoing supervision and policy-making in relation to payment systems and payment service providers, such as e-money issuers, remittance providers and digital payment token (more commonly known as cryptocurrency) service providers under the Payments Services Act. Prior to this, Mr Nagatsuka has worked in the field of capital markets regulation for over 15 years, and was previously Head of the Capital Markets Policy Division responsible for policy formulation and reviewing legislation in relation to capital markets and market infrastructures. In his role, he represented MAS on various international committees under the FSB, CPMI and IOSCO, on subjects such as OTC derivatives reforms and financial market infrastructures.

This week

Ari Redbord is Head of Legal and Government Affairs at TRM Labs, a blockchain analytics company. Prior to joining TRM Labs, he served as a Senior Advisor to the Deputy Secretary and the Under Secretary for Terrorism and Financial Intelligence at the United States Department of Treasury. In this capacity, he worked with teams from the Financial Crimes Enforcement Network (FinCEN), Office of Foreign Assets Control (OFAC), and other Treasury and interagency components on issues related to sanctions, the Bank Secrecy Act, cryptocurrency, and anti-money laundering strategies.

By doing so, the complaint alleges that Peterson and the Braverock Entities acted as unregistered dealers in violation of Section 15(a) of the Exchange Act. By doing so, the complaint alleges that Peterson and the Braverock Entities acted as unregistered dealers. The SEC’s complaint also alleges that, after Murphy and Abbott convinced Hamazaspyan to resign following the unregistered offering of BXY and the misappropriation of investor assets, the two continued the operation of the Beaxy Platform through Windy, and as such are also liable for operating an unregistered exchange, broker, and clearing agency. According to an official press release, the SEC alleges that Beaxy operated without registering as a national securities exchange, broker, or clearing agency. In its lawsuit, filed Wednesday at the Northern District of Illinois, the securities regulator also accused the platform of failing to register as a broker and a clearing agency. Beaxy suspended services on its exchange and ceased operations “due to the uncertain regulatory environment surrounding our business,” the company said on its website—the SEC said in a statement Beaxy agreed to shut down the platform.

Learn more about Consensus 2024, CoinDesk’s longest-running and most influential event that brings together all sides of crypto, blockchain and Web3. “We forthrightly committed to cooperation with the Securities and Exchange Commission for over two years, continually providing information, data and interviews to assist regulators in whatever manner we could,” Beaxy said.

Business

Hamazaspyan also allegedly misappropriated at least $900,000 for personal use, including gambling, the SEC said. Customers of the exchange will be able to withdraw their assets within 24 hours after all user orders are canceled and balances are verified and are encouraged to do so within 30 days, the SEC said. Jesse Hamilton is CoinDesk’s deputy managing editor for global policy and regulation. The most used employees email address of Beaxy is , being used 100% of the time.

• The regulator conducted a joint operation with United Kingdom’s local police departments in Exeter, Nottingham, and Sheffield, where it uncovered several ATMs operating without licenses.
• Mr Ken Nagatsuka is the Executive Director and Head of Payments Department at the Monetary Authority of Singapore (MAS).
• “We allege that Beaxy and its affiliates 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,” commented SEC chair Gary Gensler.
• Finally, the SEC charged market makers operating on the Beaxy Platform as unregistered dealers.

In addition, Windy agreed to pay $10,779 in disgorgement plus prejudgment interest, and the Braverock Entities agreed to jointly and severally pay $52,000 in disgorgement plus prejudgment interest. The penalty amounts reflect the cooperation the staff received from the settling parties during the investigation. The Securities and Exchange Commission charged cryptocurrency trading platform Beaxy on Wednesday for failing to register as a securities exchange, and alleged the company’s founder misappropriated customer money, leading Beaxy to shut down—the latest crypto firm to be swept up in a broad crackdown by U.S. regulators. The U.S. Securities and Exchange Commission filed a lawsuit against crypto exchange Beaxy last week, alleging it offered an unregistered securities sale through a 2018 initial coin offering, and that it operated as an unregistered securities exchange, broker-dealer and clearing agency. The crypto world was riveted last week by news of the US Commodity Futures Trading Commission’s hard-hitting lawsuit against industry leader Binance — and rightly so.

New Bill Unveiled to Strengthen Crypto Regulation in New York

Securities and Exchange Commission charged the company and its founder, Artak Hamazaspyan. With operating an unregistered exchange and brokerage, the agency said Wednesday in a statement. According to the complaint, Beaxy carried out the functions one might expect a national securities exchange, a broker and a clearing agency all would carry out despite not registering as any of these with the regulator. Windy and its current managers agreed to pay $79,200 in civil penalties but did not admit to or deny the SEC’s allegations, the agency said, but the SEC is still litigating securities fraud charges filed against Hamazaspyan.

So far all Coinbase has said is that the notice lists “an undefined” number of its listed cryptocurrencies, and that its Earn, Prime and Wallet products potentially violate securities law. Beaxy, for its part, claimed an “uncertain regulatory environment” as the reason for its shutdown ahead of the lawsuit’s publication. The SEC alleges Beaxy founder Artak Hamazaspyan illegally raised $8 million in an unregistered offering of its Beaxy token. The SEC is litigating its charges against Hamazaspyan for securities fraud, in violation of Section 10(b) of the Exchange Act and Rule 10b-5 thereunder and Section 17(a) of the Securities Act of 1933 (“Securities Act”), and against Hamazaspyan and Beaxy Digital for the unregistered offering of BXY in violation of Section 5(a) and (c) of the Securities Act.

Prior to that, he also served in various roles in exchange and clearing house supervisory functions. Mr Nagatsuka holds both a Bachelor of Business Management and Bachelor of Science in Economics from the Singapore Management University. The U.S. Securities and Exchange Commission (SEC) filed charges against crypto exchange https://traderoom.info/ last week, resulting in the exchange shuttering its doors after the regulator alleged it raised $8 million in an unregistered securities offering and that the company’s founder “misappropriated” nearly $1 million for personal use. On March 23, the SEC also warned against investing in crypto assets securities. The agency served Coinbase with a Wells Notice and sued Justin Sun for offering BTT and TRX as unregistered securities. “We allege that Beaxy and its affiliates 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,” commented SEC chair Gary Gensler.

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. Windy Inc. took over the platform in 2019 after the founder misappropriated money, according to the SEC, and managers Nicholas Murphy and Randolph Bay Abbott maintained Beaxy for trading crypto assets “that were offered and sold as securities,” the SEC said. So the agency is also accusing them of violating securities law by operating an unregistered exchange, broker and clearing agency, though the platform was described as defunct in another SEC case last year. Without admitting or denying the allegations in the complaint, Windy, Murphy, Abbott, Peterson, and the Braverock Entities have agreed to permanent injunctions prohibiting them from future violations of the securities laws alleged in the complaint and to pay civil penalties. Specifically, Windy, Abbott, and Murphy agreed to pay a total of $79,200 in civil penalties; Peterson agreed to pay a civil penalty of $6,600; and the Braverock Entities agreed to jointly and severally pay a penalty of $80,000.

On March 29, 2023, the Securities and Exchange Commission charged the crypto asset trading platform beaxy.com (the Beaxy Platform) and its executives for failing to register as a national securities exchange, broker, and clearing agency. The SEC also charged the founder of the platform, Artak Hamazaspyan, and a company he controlled, Beaxy Digital, Ltd., with raising $8 million in an unregistered offering of the Beaxy token (BXY) and alleged that Hamazaspyan misappropriated at least $900,000 for personal use, including gambling. Finally, the SEC charged market makers operating on the Beaxy Platform as unregistered dealers. The Securities and Exchange Commission today charged the crypto asset trading platform beaxy.com (the Beaxy Platform) and its executives for failing to register as a national securities exchange, broker, and clearing agency.

He holds a Masters of Finance from New York University’s Stern School of Business and has completed a doctorate at the Swiss Business School in Zurich, focusing on the broader economic impact of financial regulation. Regulation Asia tracks and analyses financial regulation across Asia to keep readers informed on the changes and their impacts. You’re reading State of Crypto, a CoinDesk newsletter looking at the intersection of cryptocurrency and government.

It doesn’t look like Beaxy or its executives settled the charges with the SEC, but the fact the exchange is shutting down suggests this will be the kind of case the SEC may look to for a potentially easy win ahead of the Coinbase lawsuit. Helene is a U.S. markets reporter at CoinDesk, covering the US economy, the Fed, and bitcoin. She is a recent graduate of New York University’s business and economic reporting program. Forkast.News is a digital media platform that covers stories about emerging technology at the intersection of business, economy and politics. Brad is a senior research fellow in Financial Regulation and Risk Management with The Guangzhou-Nottingham Advanced Institute of Finance and the Guangzhou University of Finance’s Institute of Financial Employment.

The regulator conducted a joint operation with United Kingdom’s local police departments in Exeter, Nottingham, and Sheffield, where it uncovered several ATMs operating without licenses. Joshua Henslee notes that the price of BSV is stuck in and around $33, sadly stating that Ordinals, a BRC-20 token on the BTC network, will soon be worth more than BSV. The exchange claimed it would make all funds available for withdrawal in 24 hours after canceling all orders and verifying balances. If you are new to crypto, use the Crypto.com University and our Help Center to learn how to start buying Bitcoin, Ethereum, and other cryptocurrencies. If you’ve got thoughts or questions on what I should discuss next week or any other feedback you’d like to share, feel free to email me at or find me on Twitter @nikhileshde. While this complaint seems pretty clear, as ConsenSys’ Matt Corva pointed out, part of the issue with registration is figuring out the asset aspect of it all.

Launched on 10 June 2019, Beaxy Exchange is a centralized exchange headquartered at The Board of Trade in Chicago, Illinois. The exchange supports 6 fiat pairs, a two-way fiat ramp, credit and debit card purchases, and spot cryptocurrency trading. Cryptocurrencies are reportedly secured by Curv institutional custody and fiat accounts are insured up to $250,000. Beaxy Exchange offers prebuilt technical analysis trading signals for cryptocurrencies listed on their platform. Their API features REST and WebSocket as well as FIX, view the documentation here.

The next few paragraphs then contrasted Beaxy with the traditional securities world, noting that a national securities exchange would not “take possession or control” of an asset being traded, while clearing agencies handle settlement and broker-dealers. The SEC charged Beaxy with raising $8 million through the unregistered offering of its native token, BXY. The regulator also alleges that the exchange’s founder, Artak Hamazaspyan, used $900,000 for personal use, including gambling. Bradley is Co-founder and Head of Research at Regulation Asia, the leading regulatory news service for the financial sector in APAC. He also advises governmental and start-up projects, including several in the digital assets and payments space. It further charged founder Artak Hamazaspyan with conducting an unregistered offering in which he raised $8 million from selling Beaxy tokens (BXY).

The SEC is litigating its charges against Hamazaspyan for securities fraud and against Hamazaspyan and Beaxy Digital for the unregistered offering of BXY. Before Fidelity, Osvaldo served around ten years at TIAA, working on the institutional side of the business for four years and the Wealth Management space for around six years. During his tenure at TIAA, he was a part of projects and pilots catering specifically to DOL and Suitability changes, including regulatory requirements and user interface. “Unfortunately, despite our best efforts, it has become clear that the regulatory environment is just too uncertain to continue operations,” Beaxy stated. “We strongly advise you to withdraw any remaining assets within 30 days to avoid unnecessary complications and delays,” the exchange told its users. The Beaxy price page is just one in Crypto.com Price Index that features price history, price ticker, market cap, and live charts for the top cryptocurrencies.