The Commodity Futures Trading Commission (CFTC) has announced it filed a lawsuit against five entities and three individuals that own and operate the BitMEX cryptocurrency exchange.
According to the CFTC, BitMEX is violating multiple CFTC regulations, including failing to implement required anti-money laundering procedures.
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The regulator particularly charges Arthur Hayes, Ben Delo, and Samuel Reed, who operate BitMEX’s platform through a maze of corporate entities.
The exchange has reportedly received over $11 billion in bitcoin (EXANTE: Bitcoin) deposits and made more than $1 billion in fees, the regulator says.
According to Chairman Heath P. Tarbert, cryptocurrencies "hold great promise for our derivatives markets and for our economy."
"For the United States to be a global leader in this space, it is imperative that we root out illegal activity like that alleged in this case. New and innovative financial products can flourish only if there is market integrity. We can’t allow bad actors that break the law to gain an advantage over exchanges that are doing the right thing by complying with our rules," Tarbert added.
The US Attorney for the District of New York indicted BitMEX CEO, Delo, and Reed, along with Gregory Dwyer, on federal charges of violating the Bank Secrecy Act and conspiracy to violate the Bank Secrecy Act.
In August 2020, BitMEX announced its plans to implement a mandatory KYC (know-your-customer) process. Starting from August 28, all platform's users are required to provide a series of documents to confirm both their identity and residence.
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