Key highlights:

  • BitMEX has faced a class action lawsuit from two investors.
  • The investors claim that the exchange benefited through illegal forced liquidations.
  • The case comes ahead of the platform’s shutdown in September.

BitMEX, a crypto derivatives exchange, is now facing a class action lawsuit in the US. The case has been filed by two traders who accused the exchange of illegally liquidating customer positions and keeping their Bitcoin. According to the lawsuit, the plaintiffs lost a combined 622.66 BTC through forced liquidations.

It is noteworthy that the BitMEX lawsuit comes just weeks ahead of the platform’s potential closure in September. After 11 years in the crypto space, the exchange has decided to shut down following a “strategic review of the business and the broader ⁠crypto industry.”

BitMEX hit with class action lawsuit

On Thursday, two BitMEX investors filed a class action lawsuit against the crypto exchange in the US District Court of the Southern District of New York. The plaintiffs, BKX Services Inc. and David Namdar, claimed that they lost 622.66 BTC as the company liquidated their positions, withholding their BTCs. While BKX lost around 305.81 BTC, Namdar found his losses exceeding 316.85 BTC. 

According to the lawsuit, BitMEX’s liquidation system was designed to profit from customer losses. The filing read, “BitMEX deliberately developed a system that profited from the liquidations.” The plaintiffs claim that the platform hasn’t taken any initiatives to protect customer funds.

The investors argue that BitMEX manipulated its liquidation process and seized their Bitcoin collateral. While the platform allowed users to trade with leverage of up to 100x, it liquidated their positions even when the remaining crypto collateral was more than the losses. They added that the leftover BTCs were moved to BitMEX’s insurance fund. The plaintiffs believe that this has helped the exchange to make profits from forced liquidations.

Via the lawsuit, they intend to get back the allegedly withheld Bitcoin. In addition, they are also seeking compensatory and punitive damages. The case also represents other US customers who traded Bitcoin swap products on the exchange since July 23, 2018.

BitMEX to shut down in September

The BitMEX class action lawsuit comes at a time when the crypto exchange is preparing for its shutdown. As CoinCodex reported recently, BitMEX is closing its operations on September 23, 2026, although the real reason is not disclosed. The company has reportedly asked its users to close their open positions and withdraw their assets before the date.

Notably, the decision follows a series of incidents impacting the company. The platform continued to face regulatory issues and legal scrutiny, although US President Donald Trump pardoned its co-founders last year. Once a major crypto exchange, BitMEX no longer remains significant in the broader market.

Kaiko data reveals that BitMEX accounts for less than 0.01% of the global crypto trading market now.

"The cryptocurrency exchange market is highly competitive, and the closure of BitMEX may suggest ​that major exchanges will continue to gain significant weight at the expense of smaller or newer ​exchanges.”

 — Kaiko analyst Thomas Probst