Crypto Exchange Bittrex Files for US Bankruptcy Protection

The most significant news at the beginning of May was the bankruptcy of the Bittrex exchange. Let’s investigate the reasons that led to the collapse of this exchange. Bittrex is the most recent cryptocurrency company to declare bankruptcy, following other exchanges such as FTX and several lenders like Celsius, Voyager, and BlockFi.

• Bittrex, a Seattle-based company established in 2013, is ranked as the 71st largest digital asset exchange with a 24-hour trading volume of only $11.7 million, as reported by CoinGecko. This trading volume is lower than that of some decentralized exchanges like Uniswap, Pankcakeswap, and Orca.
• What does the CEO of this company say about this situation?
  In a statement on Twitter, Bittrex’s CEO and co-founder, Richie Lai, expressed that it is not financially feasible to sustain the operations of the exchange given the current regulatory and economic climate in the United States.

The fundamental reason why reason why Bitterex expected the same fate as FTX:

1. Not being economically feasible in the current US regulatory and economic environment
2. Lawsuit by SEC for not claiming a lack of registration
3. Bankruptcy caused by a drop in asset prices, similar to FTX
4. Lawsuit by the Treasury Department for “apparent violations” and sanctions on certain countries and anti-money laundering law
5. Suspicions of money laundering
6. The Securities and Exchange Commission’s crackdown on American crypto companies, including Bittrex.

The US will adopt a fairly strict policy with the most popular crypto exchanges and to protect oneself, it is advisable to choose platforms that comply with the law and have a “transparent”, “сlear” reputation. Examples of three exchanges that will conduct business in full compliance with the rules are a guarantee of the preservation of your assets and have a high level of cybersecurity:

Coinbase, a major player in the cryptocurrency industry, has a reputation for being one of the largest and most secure exchanges. It boasts unmatched trading volume and is considered one purchasing a wide range of cryptocurrencies. As a U.S.-based exchange, it is subject to strict regulations, making it one of the most heavily regulated exchanges.

Kraken Exchange, is among the earliest cryptocurrency exchanges in the industry. Kraken has demonstrated its reliability as a crypto exchange time and again, with a strong focus on blockchain technology and industry-leading security.

WhiteBIT, founded in Ukraine in 2018, has quickly become one of the largest cryptocurrency exchanges in Europe, boasting over 3.5 million users. In addition WhiteBIT is also the official partner of FC Barcelona, one of the world’s most popular football clubs. The exchange offers traders access to over 270 digital assets across 350+ trading pairs, including margin trading and futures. To ensure the security of users’ funds, 96% of digital assets are stored in cold wallets with a multisignature access system, and the exchange uses WAF technology to detect and block hacker attacks.

• However, overall, what do we have in the end both Bittrex and FTX are cryptocurrency exchanges that have faced regulatory and financial challenges resulting in bankruptcy filings. The US Securities and Exchange Commission (SEC) accused both exchanges of operating unregistered securities exchanges, which led to a cease of operations for Bittrex in the United States and a criminal investigation for FTX. Additionally, both exchanges have faced financial difficulties due to drops in asset prices and increased regulatory scrutiny.