The U.S Commodity Futures Trading Commission, or CFTC, has charged the BitMEX derivatives exchange with operating an unregistered trading platform and violating anti-money laundering regulations.
According to a statement released Thursday, the CFTC filed a civil enforcement action in the Southern District of New York against five entities and three individuals who allegedly own and operate the exchange.
The individuals charged include Arthur Hayes, publicly known as the CEO of BitMEX, as well as Ben Delo and Samuel Reed. The CFTC alleges that these individuals are owners and operators of BitMEX through a “maze of corporate entities.”
The aforementioned corporate entities, who are also cited as defendants in the case, are HDR Global Trading Limited, 100x Holding Limited, ABS Global Trading Limited,Shine Effort Inc Limited, and HDR Global Services (Bermuda) Limited (BitMEX).
The CFTC seeks disgorgement, or restitution of all “ill-gotten gains,” civil monetary penalties, permanent trading bans and injunctions against future violations.
The commission believes that BitMEX has offered illegal leveraged trading services to retail traders to the tune of $1 trillion in notional value since its inception in 2014. Despite its success, the CFTC believes that the exchange failed to take “the most basic compliance procedures.” These include failure to register with the commission, and the lack of know your customer and anti-money laundering procedures.
The story will be updated as more information comes through.