The Commodity Futures Trading Commission (CFTC) is allegedly investigating the activities of the derivatives giant BitMEX. The US regulator suspects that BitMEX allowed US residents to use its platform to trade. These reports come from sources citing people familiar with the matter speaking to Bloomberg.
BitMEX is registered in the Seychelles and it is illegal for US residents to trade or do any form of transactions on its platform. Although under the current law US is excluded from using the platform and similar crypto-based financial services, users may have sought to circumvent the geo-block by using services like VPNs.
— Tim Culpan (@tculpan) July 19, 2019
This investigation came to light on social media through Bloomberg journalist Tim Culpan. Details of this month-long investigation are not yet clear for now. The regulator considers cryptos like Bitcoin to be commodities. Additionally, it has jurisdiction over futures and other derivatives based on them. For now, the CFTC has declined to comment on this matter.
As the news broke on July 19, Bitcoin came under heavy pressure dumping almost $500 within minutes to target $10,000.
BitMEX is money laundering ‘rekting racket’: Roubini
BitMEX has remained in the spotlight this entire week after a vicious showdown between serial Bitcoin naysayer Nouriel Roubini and CEO Arthur Hayes earlier in July. Roubini hit out at Hayes for delaying the release of a video recorded for the occasion following their heated debate.
On July 17, meanwhile, Roubini heightened the stakes. He published what he said was some incriminating evidence of malpractice at BitMEX. At the same time, he was insulting both Hayes and his platform. Roubini referred to his report as:
“My new column where I expose the shady rekting racket that is (BitMEX) run by the thug (Hayes): evasion of AML/KYC, front-running, insider trading, massive scale money laundering, gouging of clients, etc.”
Now the crypto community waits to see how this matter unfolds.