The future of the 1Broker platform looks up in the air…
American authorities continue to step up their battle against cryptocurrency platforms that fall the wrong side of its rulebook. This time, the Securities and Exchange Commission – SEC to its small and presumably shrinking circle of friends – has announced it’s shut down 1Broker. Thing is, 1Broker isn’t taking it lying down.
1Broker is based in the Marshall Islands, and it came to the attention of the SEC for allegedly breaching money laundering rules, and also distributing securities in spite of not being registered. As such, the SEC announced that it had taken control of 1Broker’s domain name, and closed the service down.
It posted an official confirmation of its actions on its website. You can read it in full here. The key passage reports that “the SEC alleges that a Special Agent with the Federal Bureau of Investigation, acting in an undercover capacity, successfully purchased several security-based swaps on 1Broker’s platform from the U.S. despite not meeting the discretionary investment thresholds required by the federal securities laws”.
It added that “the SEC also alleges that [CEO Patrick] Brunner and 1Broker failed to transact its security-based swaps on a registered national exchange, and failed to properly register as a security-based swaps dealer”.
However, 1Broker is not taking this move lying down, but it is appealing for resources in order to fight back against the SEC. It posted an update on its own position on its Twitter feed…
We are currently engaging U. S. counsel who can represent us in the SEC/CFTC case. We expect that this takes a few days.
We received the green light from our lawyers to set up a read-only version 1Broker to view balances and transaction history. ETA: 48 hours
— 1Broker (@1Brokercom) October 1, 2018
At the time of writing, that’s its most recent post on the matter, and it’s likely it’ll need substantive finances to fight back. 1Broker has closed open positions as per the market prices of September 28th 2018, but has no ETA on when withdrawals will be allowed again. The latest updates on the platform are likely to appear here.