• The Securities and Exchange Commission (SEC) filed a cease and desist order against ShapeShift. This bans it from acting as an unregistered U.S. dealer that lists crypto securities.
  • ShapeShift accepted the SEC’s offer to settle charges.

ShapeShift is a crypto-exchange that operated in Denver, Colorado. It has now shut down all its U.S. operations. The Securities and Exchange Commission claims that it was an unregistered dealer of cryptocurrencies before 2021.

In the Tuesday filing the SEC announced that it would accept ShapeShift’s settlement offer, which included $275,000 in fines and an agreement by the company to no longer violate Securities Exchange Act.

ShapeShift sold “at least 79 crypto-assets” to its clients, including “those offered and sold as investments contracts”, the filing stated, but it did not specify any digital assets that were securities.

It said that the exchange was unregistered in the U.S. from 2014 to 2021. This accusation is similar to what the SEC made against other U.S. crypto-exchanges such as Coinbase, Kraken, and Binance.US.

The filing stated that ShapeShift “regularly bought and sold crypto-assets for and from their own accounts” and “held inventory in and represented themselves to customers as being willing to buy and sale crypto-assets offered on ShapeShift.io“.

SEC: The company will close the U.S. Exchange in 2021.

In a footnote, it is also stated that the findings of the cease-and desist order “do not bind any other person or entities in this or other proceedings.”

SEC spokespersons did not respond immediately to a comment request.

ShapeShift’s founder Erik Voorhees sent CoinDesk an email with a link to tweet, in which he cited from the Federalist Papers.

UPDATE (6 March 2024, 0250 UTC) Adds tweet by Erik Voorhees.

Nick Baker is the editor.