BitMEX Accused of Manipulating User Funds in $100 Million Lawsuit
BitMEX, a leading cryptocurrency exchange, has been accused of manipulating and misappropriating user funds. A class-action lawsuit was filed in the Southern District of New York by BKX Services and David Namdar on behalf of American clients who traded swaps on Bitcoin since July 2018.
The plaintiffs claim that BitMEX intentionally created a system to profit from closing clients' positions, allowing its internal trading desk to execute trades even during server 'lags', when regular clients were unable to manage their positions. The exchange allegedly forcibly closed leveraged trades up to 100x, even when collateral was double the losses.
The remaining funds were directed to the platform's insurance fund, generating profit for BitMEX. The plaintiffs are seeking the return of the withheld Bitcoins and compensation.