Yesterday, the Bitcoin community was shocked by the news about the BitMEX fair.
They were sued by the U.S. Commodity Futures Trading Commission (CFTC) for operating without the proper papers and licenses. According to the regulator, BitMEX has served US investors without a valid license.
Meanwhile, the dust has settled and the exchange has come up with a statement.
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Bitcoin fair Bitmex
It is a short message in which she reassures her clients that the funds are safe and that there is no reason for the user to worry.
Would this make the directors of traditional banks shudder? The English Crypto Legacy sketches a bit of context in line with this remark. All malaise at banks has not led to arrests in recent years. Not in 2008, not at last month’s FinCEN Files, but now at a crypto fair.
„We absolutely disagree with the U.S. regulator’s harsh decision to file these charges. We intend to defend the charges. From the beginning of our start-up, we have always endeavored to comply with U.S. laws (…) based on available guidelines.“
They add that the stock market will continue to operate normally and that ‚all funds are safe‘.
The derivatives trading platform was established in 2014 and is registered in the Seychelles, but has offices in Hong Kong and San Francisco. Previously, all you had to do was provide an email address and password and identify the country of residence during the registration process.
In August of this year, BitMEX updated the policy with additional information such as ID verification and needed to tell you more about your client’s investment experience. You also need to prove where the deposited assets come from.
But it was all too late. Travis Kling reports on Twitter that the stock market could have known in July 2019 that this was coming. Nouriel Roubini goes one step further, mentioning that there are thousands of other projects and companies that need to get their chests wet.
What is positive for the fair’s customers is that BitMEX immediately started processing recordings. Usually this only happened once a day, because the fair doesn’t work with hot and cold wallets, but with a multi-sig wallet.
In total, there are no less than 193,000 BTC in the stock exchange’s custody! Belgian WhalePanda shows on Twitter that the process of Bitcoin recordings has been manually accelerated.
Problems for the CEO
The well-known crypto-space lawyer Jake Chervinsky mentions that the focus of this news may be in the wrong place.
According to him, the biggest news is that Arhur Hayes and his colleagues have been sued for ‚Bank Secrecy Act‘, and not so much that there is something wrong with the trading platform. They could go to jail for five years for this. Fellow Samuel Reed also seems to have been arrested.
Furthermore, Bill Barhydt keeps track of the state of affairs in a thread. He mentions, among other things, that the CFTC knew that BitMEX was trying to keep American customers outside with a blockade on IP addresses, but that they did not intervene enough with too weak KYC and AML procedures.
He also mentions that this could be good for the market. Unregulated markets such as BitMEX that can have a major impact on price are a thorn in the side of regulators assessing requests for ETFs. Increasing regulation will give the market more legitimacy.
It can be said that Bitcoin is not dependent on BitMEX and that the crypto currency continues to exist. Even the price has barely reacted to the news: