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In the USA, the founders of BitMEX have been charged. Originally, the identification of customers was planned for February 2021, but the changeover is being accelerated in view of the legal consequences.
It was a massive blow to one of the largest Bitcoin exchanges that specializes in derivatives trading. The CFTC brought charges against the company that operates the stock exchange and, in addition to allegations made on regulatory grounds, the matter also has a criminal dimension.
The three founders of BitMEX and a manager are supposed to be personally responsible for violations of US banking law and anti-money laundering laws. As a result, everyone resigned from their management positions, if they held any, and announced that they would not hold any more in the future.
But the separation and reorganization of management is not enough. BitMEX had announced a mandatory KYC procedure for its customers by February 2021 at the latest.
Only with passport copy
As early as November 5th, customers will be subject to massive restrictions if they do not participate in the process and prove their identity. Because then it will no longer be possible to withdraw payments from the affiliate program and you will not be able to open any new positions.
On December 4th, withdrawals will also be blocked and you can no longer get your bitcoins without KYC. In addition, open positions will then probably be closed and the exact conditions for this will be communicated in the future.
The acceleration of the measures is directly related to the actions of the US authorities and the judiciary. It seems like they want to keep the business going and no longer offer a target for this purpose.
A question of time: Binance, Bybit and FTX
It is very strange that the authorities have not yet addressed other platforms. The most serious violation of BitMEX lies in the fact that it served US customers, because the platform is automatically subject to US law. While other providers exclude business with US consumers, the measures are not effective.
All can be reached via a VPN and mostly only ask for loose information about the person, which is only checked if the customers want a higher limit. Binance reacted quite early by spinning off the US business from its mother. However, it is unclear how many US customers secretly stayed on Binance’s international platform. There you have a withdrawal volume of 2 Bitcoin per day without having to identify yourself. So unless you want to move particularly high assets on a daily basis, one account is still sufficient for most small investors.
It is a dangerous game because the actions of the authorities make it clear that violations will be punished and, if necessary, international criminal prosecutions will be initiated against those responsible.