US Treasury Fines Bittrex Exchange $29M for Multi-Year Sanctions Violation

Washington-based cryptocurrency trading platform, Bittrex He has been fined $29 million by the United States Department of the Treasury through the Office of Foreign Assets Control (OFAC) and the Financial Crimes Enforcement Network (FinCEN).

The fone, labeled as the largest ever raised by OFAC on a digital currency trading platform, became necessary considering Bittrex failed to implement proper compliance programs, helping some of its users to evade established sanctions.

According to the OFAC announcement, the trading platform “was unable to prevent individuals apparently located in the Crimea region of Ukraine, Cuba, Iran, Sudan, and Syria from using its platform to engage in virtual currency-related transactions worth approximately $263,451,600.13 between March 2014 and December 2017.”

The regulator noted that preventing these banned users would have been easy if the exchange had prevented their registration based on their IP addresses at the time of registration. The FinCEN breach involved the trading platform’s failure to institute appropriate anti-money laundering measures (AML) measures, thus creating a weak channel for the laundering of illicit financial gains.

“When virtual currency companies do not implement effective sanctions compliance controls, including detection of customers located in sanctioned jurisdictions, they can become a vehicle for illicit actors that threaten US national security,” said Andrea Gacki. , Director of OFAC. “Virtual currency exchanges operating around the world need to understand who and where their customers are. OFAC will continue to hold accountable companies, in the virtual currency industry and elsewhere, whose failure to implement appropriate controls leads to sanctions violations.”

The US Treasury has been more attentive to cryptocurrency service providers throughout the year, first coming to the fore in May when it banned cryptocurrency mixer Blender.io and later when it added Tornado Cash. to your list.

While the industry didn’t make a fuss over Blender’s ban, Tornado Cash’s has been met with so many objections, all of which have spurred industry giants like Coinbase Global Inc. to fund specific lawsuits and defense gimmicks.

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