NEO Blockchain-based Aphelion Exchange Shuts Down, Blames SEC as Refunds Issued to Users
Aphelion, a digital exchange built on the NEO blockchain, has stopped its operations due to a number of reasons including the recent rules put in place by the Securities and Exchanges Commission (SEC).
Following the shutdown, all trading pairs on the Aphelion decentralised exchange (DEX) have been terminated and the open orders cancelled. From 23rd November, the exchange has been refunding its users while APH token holders were advised to claim back their assets into their assets.
Since the launch of their DEX, the trading platform has only collected less that 3,500 APH in fees of which 80% has been distributed back to the platform’s community. The remaining 700 APH is still being held by the management which means that the DEX hasn’t made any profits.
The CEO of Aphelion, Ian Holtz in his response to the shutdown stated that,
“It’s been a perfect storm of bad news: new SEC rulings, disastrous market conditions, NEO tech challenges and diminishing cash flow. First, recent SEC action against EtherDelta sets a new precedent that directly impacts our trading platform. In short, the SEC ruled that non-custodial cryptocurrency exchanges allowing users to trade are firmly within their scope. Previously, we’d been advised that we were not in their regulatory purview. Since that action, and based on expert advice from multiple leading attorney firms specializing in compliance, we fully expect the SEC to continue to target all crypto exchanges (decentralized or not). And so, we have been advised to cease trading activities immediately and identify a path towards compliance.’’
For now the Aphelion team will start working towards compliance with regulatory authority by applying for a full broker license or merging with a financial provider that already has one. The team has also pulled out its developers who were depending on the NEO blockchain that has had some technical hitches in recent times.
The Aphelion wallet will still remain live on Android and IOS devices and will be maintained as usual. There’s also plans to keep the DEX running on the platform’s testnet until all the issues are resolved.