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BitMEX reaches an agreement With CFTC & FinCEN; will pay this penalty fee

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Regulatory crackdown on crypto exchanges seems to be the new trend now. While the XRP-SEC lawsuit continues, other crypto-based institutions settled litigations.

Crypto derivatives exchange BitMEX reached an agreement with the U.S Commodity Futures Trading Commission (CFTC) and Financial Crimes Enforcement Network (FinCEN). As per the deal, BitMEX agreed to pay as much as US$100 million to resolve the charges.

The CFTC had charged the company and several executives, including then-CEO Arthur Hayes, over operating an unregistered trading platform and violating know-your-customer and AML requirements.

According to the official release Commodity Futures Trading Commission published, stated that

“U.S. District Court for the Southern District of New York entered a consent order against five companies charged with operating the BitMEX cryptocurrency derivatives trading platform. The companies are HDR Global Trading Limited, 100x Holding Limited, ABS Global Trading Limited, Shine Effort Inc Limited, and HDR Global Services (Bermuda) Limited.”

However, the order issued by the court forbids the crypto platform from “further violations of the Commodity Exchange Act (CEA) and CFTC’s regulations”. Acting Chairman of the CFTC Rostin Behnam said:

“This case reinforces the expectation that the digital assets industry, as it continues to touch a broader pool of market participants, takes seriously its responsibilities in the regulated financial industry and its duties to develop and adhere to a culture of compliance. The CFTC will take prompt action when activities impacting CFTC jurisdictional markets raise customer and consumer protection concerns.”

Alexander Höptner, Chief Executive Officer of BitMEX had to say on the same,

“Today marks an important day in our company’s history, and we are very glad to put this behind us. As crypto matures and enters a new era, we too have evolved into the largest crypto derivatives platform with a fully verified user base. Comprehensive user verification, robust compliance, and anti-money laundering capabilities are not only hallmarks of our business – they are drivers of our long-term success.”

He added:

“We take our responsibilities extremely seriously, and will continue to actively engage with regulators around the world to ensure that we play a positive role in helping to shape the future of this extraordinary asset class.”

A new era for BitMEX?

BitMEX in a series of tweets highlighted the importance of “gaining trust”. The company stated that KYC compliance, AML, and other tools were necessary. One of the tweets stated:

“Over the past year, we’ve built this. And we’re currently seeking a license in several jurisdictions”

Source: Twitter

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Shubham is a full-time journalist at AMBCrypto. A Master's graduate in Accounting and Finance, Shubham's writings mainly focus on crypto-regulations across the United States and Europe. Also, a die-hard Chelsea fan #KTBFFH.