BitMEX Sued Over Alleged Manipulation of Customer Liquidations

BitMEX is facing another lawsuit in the United States over allegations that it profited from customer Bitcoin liquidations. The proposed class action was filed on the same day the cryptocurrency derivatives exchange confirmed its planned shutdown in September, bringing renewed attention to its liquidation practices and past regulatory challenges.

The plaintiffs claim BitMEX allowed customers to trade with up to 100 times their collateral but then liquidated positions before exhausting available funds. The complaint alleges that excess Bitcoin was transferred into BitMEX's insurance fund, allowing the exchange to benefit financially from forced liquidations.

David Namdar and BKX Services Inc. claim losses totaling 622.66 BTC through forced liquidations on the exchange. They seek the return of the Bitcoin alongside compensatory and punitive damages. The lawsuit coincides with BitMEX's planned shutdown after more than 11 years in business, during which it has faced regulatory scrutiny.

BitMEX has previously denied similar allegations and described this lawsuit as an opportunistic claim without merit. The company will defend itself vigorously against the claims.