On Jan. 15, 2025, BitMEX, a prominent cryptocurrency exchange, was ordered to pay an additional $100 million fine for violating the U.S. Bank Secrecy Act (BSA) between 2015 and 2020.
The U.S. government alleged that BitMEX, operated by its parent company HDR Global Trading, failed to implement an adequate Anti-Money Laundering (AML) program during those five years. The exchange did not have sufficient Know Your Customer (KYC) processes, which allowed U.S. users to access the platform despite BitMEX not being registered with the U.S. Commodity Futures Trading Commission (CFTC). The U.S. Department of Justice estimated that BitMEX had earned $155 million from U.S. users during this period. Although the government initially pushed for a fine of up to $420 million, the court imposed a significantly lower penalty.
In addition to the criminal charges, BitMEX’s co-founders, Arthur Hayes, Benjamin Delo, and Samuel Reed, were ordered to pay $30 million in penalties in a separate civil case in 2022. The exchange had already agreed to pay $100 million in penalties to both the CFTC and the Financial Crimes Enforcement Network (FinCEN) in 2021. Despite the ongoing legal troubles, BitMEX issued a statement expressing disappointment at the new penalty but acknowledged that the amount was lower than what had been initially sought by the Department of Justice.
BitMEX's legal issues stemmed from its failure to adhere to U.S. banking regulations, which aim to prevent money laundering and terrorism financing. The company’s executives, including co-founder Hayes, took steps to circumvent U.S. regulations by allowing users from the country to use the platform without proper AML or KYC procedures in place. BitMEX also faced accusations of misleading financial institutions to access the U.S. financial system.
The ruling marks the end of a lengthy legal saga for BitMEX, but the exchange still faces ongoing scrutiny from various regulators, and its future in the U.S. market remains uncertain.