Lawsuit targets BitMEX days after closing announcement. BitMEX is facing a proposed class-action lawsuit accusing it of operating a secret internal trading desk that allegedly traded against its own customers. The lawsuit, filed in the U.S. District Court for the Southern District of New York. It alleges that BitMEX exploited privileged access to customer trading data. Engineered liquidations and improperly retained users' Bitcoin collateral through its insurance fund. The plaintiffs are seeking the return of approximately 622.66 BTC, alongside compensatory damages and other relief. BitMEX has rejected the allegations and they have insisted they are more than ready to defend themselves in court. Ultimately, the exchange had already announced it will be shutting down its operations this coming October. Customers and asset owners encouraged to withdraw their assets. Allegations raised against BitMEX. BitMEX is being accused of secretly operating an internal proprietary trading desk. The desk had access to confidential customer information unavailable to ordinary traders. The complainers allege the desk could view hidden orders, liquidation prices, and other non-public trading data. Giving access to price levels that would trigger the largest number of forced liquidations before executing trades designed to capitalize on those movements. Whats more, the lawsuit further alleges that when customer positions were liquidated, BitMEX retained collateral exceeding traders' actual losses by transferring the remaining Bitcoin into its insurance fund rather than returning it to users. Another allegation relates to the market turmoil of March 2020. Prosecutors, claim BitMEX's systems became unavailable to customers during extreme market volatility while its internal trading desk allegedly continued operating. The complaint argues this resulted in significant customer losses that could not be avoided because users were unable to manage their positions. Despite these allegations BitMEX has remained positive that they are innocent and are ready and willing to prove themselves in court. The outcome could shape not only BitMEX's legacy, but also future expectations for how centralized exchanges operate in an increasingly regulated global market.

Lawsuit claims BitMEX used server freezes and internal trading to seize 622 Bitcoin ahead of its September closure. BitMEX customers are seeking the return of 622.66 Bitcoin in a proposed class action that accuses the exchange of engineering liquidations and retaining traders' collateral. The complaint, filed July 23 in the Southern District of New York, arrived as BitMEX began a regulator-approved wind-down ahead of its September closure. BKX Services Inc. alleges it lost at least 305.809 BTC through BitMEX liquidations in 2018, while David Namdar claims 316.856 BTC in losses from 2019 to 2020. Together they seek the coins themselves, rather than only their dollar value, under claims for replevin and fraud. The suit names BitMEX operator HDR Global Trading Limited and four affiliated companies: ABS Global Trading Limited, 100x Holdings Limited, Shine Effort Inc Limited and HDR Global Services (Bermuda) Limited. Co-founders Arthur Hayes, Samuel Reed and Benjamin Delo are also defendants, along with Gregory Dwyer. The plaintiffs allege BitMEX's liquidation engine closed positions when unrealized losses reached about half of the collateral traders had posted. According to the filing, that left collateral worth roughly twice the losses, but BitMEX seized the remainder and transferred it to its Insurance Fund instead of returning it. The complaint further alleges that an undisclosed internal trading desk could see customer positions, hidden orders and liquidation points. It claims the desk used anonymized accounts and could continue trading during server freezes that locked ordinary customers out, while also trading on reference exchanges to induce price moves that triggered liquidations. The allegations have not been proven in court. BitMEX CEO Peter Wilkinson rejected the case in comments to Benzinga, calling it "spurious and opportunistic" and saying the company would defend itself vigorously. The filing revisits conduct covered by an earlier BitMEX class action brought in 2020 under the Commodity Exchange Act. That case was voluntarily dismissed without prejudice in June 2025, without a ruling on the merits. The new action instead pleads replevin and fraud and argues that the earlier case paused the applicable limitations period. The Financial Services Authority of Seychelles said HDR voluntarily withdrew its pending virtual-asset licence application on July 23. The regulator-approved plan limits HDR to winding down operations, closing positions and returning client-held assets before exchange services cease on Sept. 23. BitMEX's closure notice says users will retain access after that date to view balances and withdraw funds, and the company says its assets exceed its liabilities. The wind-down plan covers client-held assets but is silent on Bitcoin disputed through historical liquidations, so the shutdown adds urgency to the ownership question without establishing that jurisdiction, the case or recovery has been impaired.

BitMEX sued for engineering customer liquidations to seize traders' Bitcoin collateral. The lawsuit was filed the day BitMEX announced its shutdown. Lawsuit alleges excess Bitcoin collateral was retained. Plaintiffs claim losses totalling 622.66 BTC. BitMEX is facing fresh legal trouble after a class-action lawsuit accused the cryptocurrency derivatives exchange of deliberately engineering customer liquidations to take possession of traders' Bitcoin collateral. The lawsuit was filed on the same day the company announced plans to shut down its operations, placing renewed attention on allegations surrounding its liquidation system and trading practices. The case, filed in the US District Court for the Southern District of New York, seeks to recover hundreds of bitcoins that the plaintiffs claim were wrongfully taken through forced liquidations. Lawsuit claims more than 622 Bitcoin were wrongfully seized. The lawsuit was brought by BKX Services Inc. and investor David Namdar, who allege they collectively lost 622.66 BTC because of BitMEX's liquidation process. According to the complaint, BKX Services lost at least 305.81 BTC, while David Namdar claims losses exceeding 316.85 BTC. The plaintiffs argue that these losses were not the result of normal market conditions but stemmed from a liquidation system that allegedly operated in BitMEX's favour. The complaint accuses the exchange of intentionally triggering liquidations that enabled it to retain customers' remaining Bitcoin collateral. It further alleges that BitMEX profited from these liquidations instead of returning any excess collateral after positions were closed. The plaintiffs are seeking damages and other legal remedies, arguing that the exchange's practices caused significant financial losses over multiple trading events. Plaintiffs challenge BitMEX's liquidation model. At the center of the lawsuit is BitMEX's liquidation engine, which the plaintiffs claim was designed to benefit the exchange rather than protect traders from excessive losses. BitMEX became one of the largest crypto derivatives platforms by offering leveraged trading of up to 100x, allowing traders to control positions much larger than their deposited collateral. While leverage can increase profits, it also raises the risk of liquidation when the market moves against a position. The complaint alleges that traders' positions were liquidated even when the remaining collateral exceeded the amount required to cover losses. Instead of returning the excess Bitcoin after closing the positions, the lawsuit claims BitMEX retained those funds. The plaintiffs also allege that server outages and disruptions during periods of heightened market volatility contributed to liquidations that could have been avoided. According to the filing, these incidents prevented some traders from managing or closing their positions before they were automatically liquidated. The lawsuit argues that these practices allowed the exchange to accumulate customer Bitcoin through forced liquidations rather than simply covering trading losses. Legal action coincides with BitMEX shutdown announcement. The timing of the lawsuit has drawn attention because it was filed on the same day BitMEX announced that it would cease operations. The company said it plans to shut down on September 23, 2026, following a strategic review of its business. As part of the closure process, customers have been advised to close open positions and withdraw their assets before operations end. The legal action now adds another layer of uncertainty to the exchange's final weeks of operation. While the shutdown announcement focused on the company's decision to wind down its business, the lawsuit raises separate allegations regarding the handling of customer funds and liquidation practices. The claims made in the complaint have not been proven in court, and the lawsuit represents allegations brought forward by the plaintiffs. The court proceedings will determine whether BitMEX or its related entities bear legal responsibility for the alleged losses. The case also revives long-running scrutiny of BitMEX's liquidation system, which has been the subject of debate within the cryptocurrency trading community for years. As the exchange prepares to end its operations, the outcome of this lawsuit could become one of the most closely watched legal disputes involving a crypto derivatives platform and its treatment of customer collateral.