The well-known crypto exchange has just been hit with a $100 million fine for violating the Bank Secrecy Act.
The U.S. Department of Justice’s announcement is a quite big deal for the crypto industry.
No KYC, no problem? Think again!
So, what did BitMEX do wrong? Well, it turns out they knowingly dodged U.S. anti-money laundering rules and allowed traders to access their platform with minimal know-your-customer checks. Not exactly the best move when you’re dealing with financial regulations.
Along with the fine, U.S. Attorney Matthew Podolsky made it clear that this ruling sends a strong message: ignore AML and KYC requirements, and you’ll pay the price.
Not so long ago BitMEX pleaded guilty to BSA violations back in July 2024 after a long legal battle.
Initially, they were set to pay $110 million in penalties but ended up facing even more financial repercussions.
No business without KYC and AML?
In response to the judgment, BitMEX expressed disappointment over the additional penalty but noted that it was way less than the $420 million the DOJ had originally pursued over three years.
They called the charges old news and said they were relieved to finally resolve the issue.
The company is now focused on innovating and improving their services and has promised to strengthen their regulatory compliance with better user verification systems.
BitMEX was founded in 2014 by Arthur Hayes, Benjamin Delo, and Samuel Reed, with Gregory Dwyer joining later.
The court found that they were fully aware of legal requirements but chose to ignore them, allowing U.S. traders to access their platform with barely any verification.
Complex legal case
Investigations revealed that BitMEX took deliberate steps to evade U.S. laws and misled a bank about a subsidiary’s operations to funnel millions through the financial system, prioritizing profits over compliance.
This latest ruling is part of a broader criminal case, all four founders had previously pleaded guilty to BSA violations and faced sentencing in 2022.
Earlier that year, they also coughed up a combined $30 million in fines from a civil case brought by the Commodity Futures Trading Commission.
To top it off, BitMEX agreed to pay $100 million to settle with both the CFTC and the Financial Crimes Enforcement Network.
Hayes even stepped down as CEO in 2020 and later surrendered to U.S. authorities related to these criminal charges.
