The founders of BitMEX have admitted to violating the Bank Secrecy Act

For BitMEX founders’ roles in violating the Bank Secrecy Act and operating a “money laundering platform,” Arthur Hayes and Benjamin Delo will each have to pay a fine.
The founders of BitMEX have admitted to violating the Bank Secrecy Act
The founders of BitMEX have admitted to violating the Bank Secrecy Act

After a lengthy legal battle with the US Department of Justice, the founders of cryptocurrency exchange BitMEX have pled guilty to breaching the Bank Secrecy Act (DOJ).

At their crypto derivatives and futures exchange, BitMEX, American Arthur Hayes and British Hong Konger Benjamin Delo acknowledged to “willfully neglecting to establish, implement, and manage an anti-money laundering (AML) program.”

BitMEX is a crypto trading platform situated in the Seychelles that offers crypto futures, derivatives, and margin trading up to 100x.

Americans used to be able to use the exchange’s services without having to go through any know-your-customer (KYC) or anti-money laundering (AML) checks.

According to the DOJ’s notice on the case on February 24, BitMEX became a “money-laundering platform” as a result of its lack of regulatory compliance.

Hayes and Delo both entered guilty pleas before of the March trial date, agreeing to pay a total of $10 million in criminal fines.

Operating a crypto business in the United States involves “the obligation for those enterprises to do their share to help drive out crime and corruption,” according to DOJ attorney Damian Williams.

He went on to say that the company was a “platform operating in the shadows of financial markets,” adding that The allegation that Hayes bribed the Seychelles municipal government when it completed its transfer there in 2020 bolstered the DOJ’s case.

“Arthur Hayes and Benjamin Delo built a company designed to flout those obligations; they willfully failed to implement and maintain even basic anti-money laundering policies.”

He is said to have boasted that the bribing cost him only a coconut.

Despite the fact that the company’s headquarters were in the United States from roughly 2015 to 2020, Hayes and Delo claimed that no Americans used the platform.

The Department of Justice established that the claim was false.

By January 2021, the exchange claimed to have vetted all of its users through a KYC-AML process.

BitMEX’s proportion of Bitcoin futures open interest (OI) has shrunk to insignificance since properly verifying all of its users.

In February 2021, there was only roughly $3.5 billion in OI, with BitMEX accounting for nearly a third of it.

According to data from CoinGlass, there is now $15.18 billion in OI, with BitMEX accounting for only $482 million, or 3%.