BitMex Denies Reports about Closing US Trading Accounts due to Regulatory Pressure

According to the exchange, recent media reports are false as the company has never allowed US citizens to register.

BitMex, one of the largest crypto derivatives markets on a global level, has rebuffed recent media reports claiming that the firm had closed its services for US investors after regulators pushed for it. The exchange said that it has never allowed people with American citizenship to open accounts as the United States is on its list of restricted territories. However, the company did not deny the allegations about the recent suspension of its services in Quebec, the French-speaking autonomous region of Canada.

On Tuesday, South China Morning Post newspaper said that BitMex had shut down operations in those territories because of the increasing regulatory oversight on the crypto market. Quebec’s market regulator, the Autorité des Marchés Financiers (AMF), confirmed the information explaining that in early 2018, AMF told BitMex that it had to close all accounts that belonged to local investors as the exchange was offering unauthorized services. BitMex responded immediately by halting Quebec’s operations, the regulator said.

“We informed this company that its activities were illegal,” AMF’s director of media relations told the SCMP.

According to the SCMP, Quebec’s decision was followed by the same in the US because of the recent Securities and Exchange Commission (SEC) and Commodity Futures Trading Commission (CFTC) actions against foreign-based trading platforms. An anonymous source close to the company told SCMP that while suspension in Quebec is not a significant one, the halting of the US services would impact the BitMex revenues. Currently, the US market accounts for one-seventh of BitMax’ trading, which put the country on the second place after Asian region, the source noted.

On Wednesday, SCMP updated its article with the BitMex position. However, the initial news has already created a buzz in the crypto community due to the fears that US pressure on one of the largest crypto exchanges could lead to a new Bitcoin (BTC) price crash.

“BitMEX has banned all US traders since 2015, and has been proactively closing accounts since guidance was obtained by US regulators, in particular the Commodities and Futures Trading Commission (CFTC),” Joe Coufal, whose firm Wachsman represents the exchange, said in an emailed statement to SCMP.

“BitMEX has always retained the right to close any accounts and to liquidate any open positions where trading participants have given false representations as to their location or place of residence.”

The information on the BitMex website shows that the company prohibits the creation of accounts form citizens of the following territories: the US, Quebec, Cuba, Iran, Syria, North Korea, Sudan, and the Russian occupied peninsula of Crimea. There is no available data when the information was last updated.

Registered in Seychelles, BitMex has one of the largest crypto trading volumes on a daily basis. The exchange clocked $46.4 million in trading for the last day, according to Coinmarketcap data. BitMex’ main product is a BTC/US dollar perpetual derivatives contract.

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