- BitMEX aces a $100M fine and probation for violating U.S. anti-money laundering laws from 2015-2020.
- Founders Arthur Hayes, Benjamin Delo, and Samuel Reed previously pleaded guilty, paying $110M in fines across cases.
- BitMEX ignored basic compliance protocols like KYC, becoming a money laundering hub.
Cryptocurrency exchange BitMEX faces a $100 million fine and two years of probation for deliberately violating U.S. anti-money laundering laws, according to the Department of Justice’s Wednesday announcement. The sentence, handed down by U.S. District Judge John Koeltl in Manhattan, follows the exchange’s guilty plea last July.
The case traces back to BitMEX’s operations between 2015 and 2020, when prosecutors say the exchange willfully ignored Bank Secrecy Act requirements. The DOJ found that BitMEX failed to implement basic anti-money laundering protocols and “know your customer” programs. This allowed the platform to become a hub for money laundering activities.
This latest fine adds to an already substantial financial burden for BitMEX and its founders. Arthur Hayes, Benjamin Delo, and Samuel Reed previously entered guilty pleas in 2022, receiving probation sentences. The exchange and its founders have now paid approximately $110 million across various criminal and civil cases.
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Prosecutors initially sought a much larger penalty of $417 million, arguing that BitMEX showed little genuine acceptance of responsibility. They noted that the exchange only entered its guilty plea after realizing it had “no choice” following its founders’ admissions of guilt.
The exchange’s troubles began in fall 2020 when the Department of Justice and Commodity Futures Trading Commission charged Hayes, Delo, and two other BitMEX employees. The charges centered on operating an unregistered trading platform and violating anti-money laundering regulations. Following these charges, Hayes stepped down from his position as CEO.
In their defense, BitMEX’s legal team argued against additional fines, pointing to previous settlements and the company’s transformation into a “compliant business.” They also noted that many cryptocurrency exchanges struggled to adapt during a period of regulatory uncertainty in the industry.
The February 2022 guilty pleas of Hayes and Delo marked a turning point in the case. Each founder agreed to pay $10 million in fines as part of their plea agreements. The investigation revealed that BitMEX had neglected basic identity verification for customers, ignored money laundering reports, and allowed transactions that violated U.S. sanctions.
