BitMEX faces a new class-action lawsuit alleging it operated a secret trading desk that profited from customer liquidations, including during the March 2020 crash. Two plaintiffs claim combined losses of 622.66 BTC.
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BitMEX and three of its co-founders are back in a U.S. courtroom. A class-action lawsuit filed July 23 in the Southern District of New York accuses the crypto derivatives exchange of running a hidden internal trading desk that profited from customer losses.
The complaint was brought by BKX Services Inc. and individual trader David Namdar, who say they represent a group of users who traded on BitMEX between November 2014 and October 2024. The defendants include HDR Global Trading Limited, the company that owns BitMEX, along with co-founders Arthur Hayes, Ben Delo, Samuel Reed, and former executive Gregory Dwyer.
At the center of the case is the claim that BitMEX maintained a “Insider Trading Desk” that took the opposite side of customer orders while publicly marketing itself as a neutral marketplace. The plaintiffs allege that the exchange had exclusive access to user order flow – including hidden orders that ordinary traders could not see – giving the platform a structural information advantage.
BKX Services says it lost about 305.81 bitcoin. Namdar says he lost roughly 316.86 bitcoin. Combined, the two plaintiffs claim losses of 622.66 BTC, worth approximately $40.7 million at the time of filing. The complaint argues that many other users suffered similar losses and that they would never have used the platform if the alleged desk had been disclosed.
According to the filing, BitMEX collected more than $1 billion in trading fees over the ten-year period. Its flagship XBTUSD perpetual contract generated over $2 trillion in notional volume. The plaintiffs assert that the internal desk systematically profited from customer liquidations while also boosting fee revenue.
One specific event the lawsuit highlights is the market crash of March 13, 2020, when roughly $800 million in leveraged positions were liquidated across the exchange. The plaintiffs claim that many traders could not reach the platform because of outages, yet the alleged insider operation continued uninterrupted, accumulating additional gains through fees, liquidations, and growth in the insurance fund.
The timing of the lawsuit is tight. It arrived one day after BitMEX announced the closure of its exchange operations.
This is not the first legal headache for the platform. In 2020, U.S. regulators pursued BitMEX over alleged failures to comply with anti-money-laundering and Bank Secrecy Act requirements. That case ended with a $100 million settlement and guilty pleas from Hayes and Delo. The new lawsuit goes further, focusing on how the exchange managed customer order flow behind the scenes.
For former BitMEX users who suffered significant liquidations, the class action offers a path to recover assets they believe were lost under unfair conditions. The plaintiffs are asking the court to certify the class and order the return of customers’ bitcoin, plus compensatory and punitive damages, legal costs, and interest.
The defendants have not yet filed formal responses. The allegations remain unproven.
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