Bittrex Denies Cover-Up Allegations of North Korean Traders

Cryptocurrency exchange Bittrex today confirmed that it’s still excluding residents of North Korea and other countries embargoed by the United States from using its services. The announcement comes as the Seattle-based company revealed allegations from the New York state regulators that it allowed two to open accounts on its platform.
“After reviewing the two alleged accounts provided to us on Thursday, we informed NYDFS that Bittrex had previously investigated these users in Oct. 2017,” the exchange said.

Bittrex denies any wrongdoing on their client’s part, further explaining that two South Korean residents, while registering new accounts, had mistakenly selected North Korea in the country dropdown menu. However, the platform has determined through country identification, physical and IP addresses that all actions came from South Korea.
Bittrex added it is willing to address any questions the authorities may have.
The US law currently prohibits financial services providers, including crypto venues, from doing business with residents of North Korea, Iran, the Crimean region, Syria, and Cuba as well any person with economic sanctions levied against them by the federal government.
The Crypto loophole
As such, in 2018 new terms of service which specify that it doesn’t offer its platform to any “a citizen or resident of any state, country, territory or other jurisdiction that is embargoed by the United States.”
This new guidelines came in great part as a reaction to the growing use of cryptocurrency by certain countries as a means to evade the economic restrictions that cut them out of the international financial system. Thanks to their decentralized and anonymous nature, cryptocurrencies allow sanctioned nations to bypass these restrictions and send or receive money without hindrance.
The last year had already seen a growing awareness of among nations affected by US sanctions. For example, Iran, Russia and Venezuela revealed plans to launch their own national cryptocurrencies.
Earlier this month, the New York Department of Financial Services (NYDFS) has , citing deficiencies in its AML rules and compliance program, as well as due diligence and controls over its token and product launches. The state regulator added that the Bittrex failed to “demonstrate that it will conduct its business honestly, fairly, equitably, carefully, and efficiently.”

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