“Platforms like the Beaxy Platform require users to deposit with the platform all of the crypto asset securities that they traded there, resulting in the platform possessing, and even becoming the legal owner of such assets and thus a central securities depository,” the filing said. “This type of arrangement means that an unregistered crypto asset platform like the Beaxy Platform could use assets in their possession and control for its own purposes, thereby exposing investors to significant and at times undisclosed risk of loss of their assets. Investors who invest through such a platform may face a risk that, if the platform were to enter bankruptcy, they might not be able to withdraw their assets and would become unsecured creditors of the bankruptcy estate.”
The SEC’s Beaxy Suit Looks Like a Coinbase Case Preview
