The popular cryptocurrency exchange, Poloniex, has been fined $10 million by the United States Securities and Exchange Commission (SEC).
Poloniex has agreed to pay $10 million in settlement with SEC for operating an unregistered digital asset exchange.
According to a Monday statement by SEC, the exchange offered trading of cryptocurrencies deemed securities to U.S. investors between July 2017 and November 2019 without registering as a securities broker in violation of Section 5 of the Exchange Act.
Moreover, the Commission also found that employees of Poloniex had stated that they wanted the exchange wanted to be “aggressive” in making new digital assets available on the platform.
According to the Commission’s enforcement chief Kristina Littman:
Poloniex chose increased profits over compliance with the federal securities laws by including digital asset securities on its unregistered exchange. […] Poloniex attempted to circumvent the SEC’s regulatory regime, which applies to any marketplace for bringing together buyers and sellers of securities regardless of the applied technology.
As reported by SEC, Poloniex has neither admitted nor denied any unregistered trading but has agreed to pay a fine of about $10.3 million while agreeing to a cease-and-desist order.
In a regulatory filing in July, Circle said it had set aside more than $10 million in anticipation of the SEC’s complaint. In March, it had offered to settle the case for $10.4 million.