Crypto Exchange ShapeShift Settles SEC Charges Over Alleged Illegal Activities

By: Eliza Bennet

ShapeShift, a cryptocurrency exchange launched in 2014, has reached a settlement with the US Securities and Exchange Commission (SEC) for charges related to the sale of crypto securities. The platform, which transformed into a decentralized, non-custodial model in 2018, witnessed a cease-and-desist initiated by the federal entity.

Last year, the company dissolved its U.S. crypto exchange operations amidst growing regulatory scrutiny. ShapeShift's troubles highlight the challenging regulatory landscape that cryptocurrency exchanges navigate.

The non-custodial model popularized by ShapeShift aims to decrease risk by allowing users to maintain control of their personal wallets, adding another layer to the regulatory complexities faced by the industry.