On August 22, 2018, the Securities and Exchange Commission (SEC) announced that it had filed an amendment to its complaint against defendants Timothy Tilton Ayre and Robert Faiella, in which the SEC alleged that the defendants had violated federal securities lAWS by running an illegal bitcoin-denominated exchange and engaged in money laundering. The SEC’s amended complaint added charges against Ayre and Faiella for violating the anti-fraud provisions of the federal securities lAWS.
In its amended complaint, the SEC alleged that from December 2014 to January 2015, Ayre and Faiella operated an online bitcoin exchange on behalf of their customers, allowing them to buy and sell bitcoins with U.S.
dollars. The SEC alleged that, in order to attract customers and increase trading volume on their exchange, Ayre and Faiella engaged in a number of deceptive practices, including making false and misleading statements about their experience as traders, their ability to provide liquidity, and the safety of customer funds.
The SEC also alleged that Ayre and Faiella violated the anti-money laundering provisions of the Bank Secrecy Act by failing to implement adequate policies and procedures to prevent money laundering on their exchange. The SEC’s amended complaint seeks permanent injunctions against Ayre and Faiella, disgorgement of ill-gotten gains plus interest, and civil penalties.
NOTE: The SEC has not approved a Bitcoin ETF. While there have been attempts to create one, none have been approved by the SEC at this time. Investing in a Bitcoin ETF carries significant risks and it is important to understand the full scope of these risks before investing. Investors should research any potential investments thoroughly before moving forward.
The SEC’s announcement comes just days after the commission rejected a proposal for a bitcoin-based exchange-traded fund (ETF) from investment firm Winklevoss twins, citing concerns about fraud and manipulation in the underlying bitcoin market. The decision to reject the Winklevoss ETF proposal was seen as a major setback for efforts to bring a bitcoin ETF to market, as many believed that the SEC would eventually approve a bitcoin ETF once the underlying market matured.
However, with the filing of this amended complaint against Ayre and Faiella, it appears that the SEC is taking a more cautious approach to approving a bitcoin ETF.
The SEC’s actions against Ayre and Faiella are likely to add more fuel to the debate over whether a bitcoin ETF is needed or not. While some believe that a bitcoin ETF would provide much-needed legitimacy to the digital currency market, others argue that such a fund would be susceptible to manipulation by insiders.
Until the SEC makes a decision on whether or not to approve a bitcoin ETF, it is unlikely that we will see any major breakthroughs in bringing such a product to market.
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Bitcoin ETFs have been in the news a lot lately. Some people think they are a good investment, while others are not so sure. Let’s take a closer look at Bitcoin ETFs to see if they are a good investment for you.
