BitMEX intends to fight accusations from US regulators

BitMEX has vowed to fight back following accusations that the company was involved in illegitimate activities.

BitMEX accused of fraud by CFTC

Yesterday, the Commodity Futures Trading Commission (CFTC), a major regulator of US markets, accused the owners of the BitMEX exchange of illegally operating a cryptocurrency derivatives trading platform and violating anti-money laundering regulations.

To this end, the CFTC accuses 5 entities and 3 individuals who own BitMEX of not implementing the required procedures to combat money laundering.

Among those charged are the owners of BitMEX: Arthur Hayes, Ben Delo and Samuel Reed, who operate the platform through a “maze of companies”, according to the CFTC. These multiple entities are:

• HDR Global Trading Limited
• 100x Holding Limited
• ABS Global Trading Limited
• Shine Effort Inc Limited
• HDR Global Services Limited

For CFTC Chairman Heath P. Tarbert, digital assets hold great promise for the derivatives markets and for the US economy. To this end, he declared:

It is imperative that we root out illegal activities like the one alleged in this case. New and innovative financial products can only thrive if there is market integrity. We cannot allow bad law-breaking players to take advantage of exchanges that do the right thing by playing by our rules.

According to the regulator, BitMEX has deliberately failed to implement effective programs to verify the identity of its customers and fight money laundering. The agency even claims that BitMEX has been warned for years that its operations are illegal.

BitMEX won’t let it go

In response to reports from the CFTC and the Department of Justice filing a complaint against HDR Global Trading Limited and its related companies, the group said in a statement:

We strongly disapprove of the brutal decision of the US government to bring these charges, and we intend to vigorously defend the claims. From our beginnings as a startup, we have always sought to comply with applicable US laws, as they were designed at the time and based on available guidelines.

For the moment, the BitMEX platform is therefore functioning normally and users’ requests for withdrawals of funds remain operational.

However, be careful if you are holding funds on the platform, it is undoubtedly safer to exit BitMEX until this matter comes to an end. A good alternative would be ByBit. While some are already celebrating that BitMEX may disappear in the near future, such an event would bode ill for Bitcoin and the development of the network.

Many developers from HDR Global Trading funds are working on Bitcoin Core, the open-source infrastructure that supports the BTC network. At present, it is difficult to know the potential outcome of this case, but these accusations against BitMEX are once again damaging the reputation of the platform.