BitMEX Faces Class Action Lawsuit Amid Shutdown of Operations
BitMEX, a crypto derivatives trading exchange founded by Arthur Hayes, is facing a class action lawsuit in the US. The lawsuit was filed on Thursday, the same day BitMEX announced it would cease its exchange activities forever.
The plaintiffs, BKX Services Inc. and David Namdar, claim that BitMEX has been mismanaging customer liquidations to profit from their losses. They allege that the exchange created a system to benefit from forced liquidations, which allowed it to take Bitcoin collateral from customers.
The lawsuit claims that BitMEX allowed traders to trade with up to 100 times their collateral and then moved excess funds to its insurance fund. The plaintiffs are seeking reimbursement of allegedly stolen Bitcoin and damages, including punitive damages.
BitMEX has denied the claims, stating that it will defend against the lawsuit. A spokesperson said, 'BitMEX has had many such claims against the platform in our history and has successfully dealt with each and every one.'