Cryptocurrency platform ShapeShift—which wound down operations in 2021—has agreed to a cease-and-desist order and a $275,000 fine to settle allegations from the U.S. Securities and Exchange Commission (SEC) that it allowed users to trade digital tokens without registering as a broker or exchange.

The settlement, announced on Monday, resolves a years-long SEC investigation into whether ShapeShift’s conduct violated federal securities laws.

The SEC’s case focuses on ShapeShift’s operations between July 2017 and November 2019, when the former crypto exchange allegedly facilitated the purchase and sale of digital assets that were investment contracts and therefore securities that ShapeShift had not properly registered to sell.

“The crypto assets offered by ShapeShift included those that were offered and sold as investment contracts and, therefore, securities,” the SEC asserted. ”ShapeShift never registered as a dealer with the Commission or operated pursuant to any exception or exemption from registration.”

Although ShapeShift is now defunct, the SEC says it was once a very active player in the crypto space.

“At its peak, the ShapeShift platform allowed customers to effect exchanges of at least 79 crypto assets,” the federal regulator asserts. ”ShapeShift acted as a m

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Author: Ryan Kawailani Ozawa

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