[Update 07:24 UTC, July 24: Adds BitMEX response in fifth paragraph.]
BitMEX has been accused of re-engineering customer liquidations fraudulently to take traders’ Bitcoins as collateral.
BKX Services Inc. & David Namdar were in the same room on Thursday. filed the US District Court for the Southern District of New York. BKX claims losses at least of 305.81 BTC, while Namdar says losses exceed 316.85 BTC.
The suit revives allegations that have been made for years about the internal trading and liquidation operations of the platform.
“BitMEX deliberately developed a system that profited from the liquidations,” The plaintiffs made the following allegations: According to the plaintiffs, an internal trading desk could access private information about customers and continue trading even if servers freezed during which ordinary users were unable to access or close their positions.
“BitMEX has had many such claims against the platform in our history and has successfully dealt with each and every one,” Cointelegraph was told by a BitMEX spokeswoman. “This is yet another opportunistic claim with no basis; we look forward to vigorously defending ourselves again this time.”
BitMEX users seek Bitcoin return under fraud claims
BitMEX, according to the complaint, allowed its customers to leverage their positions up to 100 fold. They then liquidated the position automatically, even though the collateral still was worth double the amount of losses.
According to the plaintiffs, BitMEX was able to make money from forced liquidations by placing the BTC into BitMEX’s platform insurance fund.
Plaintiffs seek the return of Bitcoin that was allegedly held back, as well as punitive and compensatory damages. The plaintiffs are US clients who have purchased BTC Swap products since July 23, 2018
Related: BitMEX delists 65 trading pairs, derivatives in July amid exchange shutdown
A class-action lawsuit filed by Brett Messieh in 2020 and others traders accusing similar conduct was also cited. The case was dismissed without prejudice on June 30th, 2025. It brought allegations under the Commodity Exchange Act.
BitMEX shuts down, and a lawsuit is filed.
BitMEX was the day that BitMEX filed the proposed class action lawsuit announced that it would close After 11 years in operation.
BitMEX has announced it will stop offering services after its strategic review, conducted by HDR Global Trading.
Starting on August 26, it will no longer accept new registrations, and users won’t be able to create new positions. This announcement was made on August 26. followed by a roughly 90% plunge BitMEX BMEX utility token.
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Source: cointelegraph.com
