BitMEX was founded in 2014 to trade futures contracts and derivatives tied to the value of cryptocurrencies, including Bitcoin. Since its inception, BitMex, derived from the Bitcoin Mercantile Exchange, has been a cryptocurrency and derivative trading platform that, according to its website, has enabled transactions in cryptocurrencies worth more than $1 trillion, while collecting more than $1 billion in fees. Many people are promoting the Bitmex affiliate program (among other crypto affiliate programs) but following the recent Bitmex news, one should maybe think twice about promoting the exchange.
According to the indictment and complaint, the traders withdrew $818 million worth of Bitcoin from BitMEX, indicating that they strongly deny the allegations and intend to vigorously defend themselves against the allegations. US Attorney General Jeff Sessions and the US Attorney for the Southern District of New York said that the four defendants had violated banking secrecy by circumventing the requirements of the Foreign Corrupt Practices Act (FPCA) and the Securities and Exchange Commission’s (SEC) anti-money laundering laws. Feingold said the case against Bit MEX is a precedent – because it is the first time it has been used to prosecute a financial institution outside the banks, rather than using the law against a cryptocurrency company.
The US legal system is beginning to crack down on the cryptocurrency ecosystem, and it is not just a matter of time before the arrests and deaths of cryptocurrency watchdogs emerge and cause solvency problems. While the headlines scream for more arrests and reinforce perceptions of crime as cryptocurrencies dip, they are in contrast to where we are today, where fintech and blockchain stand – at the heart of the global financial system.
A CFTC press release states that the BitMEX platform has received more than $11 billion in Bitcoin deposits and has paid and earned more than $1 billion in Bitmex fees while conducting important aspects of its business in the US and accepting orders and funds from its customers. DCEP is still evolving, and although it has not yet been publicly released, the platform is already showing maturity by allowing small and medium-sized banks to connect to it for RMB money transfers. Wunderbit reaffirmed its commitment to contributing to consistent profits as one of the fastest growing automated crypto trading platforms in the market. In the first quarter of 2016, Bit MEX received bitcoin and other cryptocurrencies worth over $2.5 billion, according to the US Federal Reserve Bank of New York. (NYSE: BNY), and it has made and earned more – more than $1 billion without fees from all those U.S. customers, with a total of $4.2 billion in deposits.
BitMex is touted as one of the world’s largest cryptocurrency exchanges, but regularly faces accusations of market manipulation as it has become a major company profiting from a crash in Bitcoin. As a result of these allegations, many users have withdrawn Bitcoin from the exchange, and Coinmetrics added in a comment on Twitter that Binance and Gemini together had captured 1 / 3 of all BitMex withdrawals. The problem with highly leveraged trades in Bitcoin and other cryptocurrencies is that a crash can cause a sell-off – caused by liquidation.
The cryptocurrency exchange BitMEX has been in a slump for several hours, and the company has officially announced that it has experienced a failure of its trading engine. The outage of the cryptocurrency exchange’s trading engines was noted on BitMex’s Twitter account when this article appeared, according to Coinmetrics, a cryptocurrency trading platform.
The total market capitalization of crypto has lost more than $13 billion after BitMEX was accused of violating US regulations, according to Coinmetrics.
The major trading platform is accused of trading digital assets such as Bitcoin, ether and litecoin and offering illegal derivatives instruments to US citizens. The lawsuit also states that more than half of BitMEX’s total trading volume came from US traders because the Exchange did not have the appropriate license to facilitate such trading. In May 2019, Bit MEX wrote on its blog that the majority of traders traded with maximum leverage, with the company offering commodity transactions leveraged with a maximum of 100 times time capital and a minimum of 1,000 times leverage from November 2014. Although registered with the CFTC as required by law, BitMex “profited from offering digital investment derivatives such as futures, options and swaps, including futures and option swaps, to individuals outside the United States without registering them or offering them illegal derivatives for trading with US citizens,” the lawsuit states.