BitMEX has been hit with a new US class action lawsuit accusing the crypto derivatives exchange of fraudulently arranging liquidations to keep traders’ Bitcoin collateral. The complaint, filed in the US District Court for the Southern District of New York on Thursday, targets BKX Services Inc. and David Namdar as plaintiffs and is directed at BitMEX operator HDR Global Trading, according to the court filing.
The lawsuit comes at a sensitive moment for the platform: BitMEX has announced it will shut down after a strategic review by its owner, HDR Global Trading, with services scheduled to stop on Sept. 23. BitMEX also plans to prevent users from opening new positions starting Aug. 26.
Key takeaways
- The plaintiffs allege they collectively lost 622.66 BTC due to forced liquidations tied to BitMEX’s automated liquidation mechanics.
- BKX Services claims losses of at least 305.81 BTC, while David Namdar alleges losses exceeding 316.85 BTC, per the lawsuit.
- The filing asserts an internal trading operation could allegedly continue trading during server freezes that supposedly blocked ordinary users from managing positions.
- Customers are seeking return of the allegedly withheld Bitcoin, along with compensatory and punitive damages.
- The case follows a prior class action in 2020 that was dismissed without prejudice on June 30, 2025, and it is being filed as BitMEX prepares to close.
Allegations centered on liquidation design and collateral seizure
According to the complaint, BitMEX permitted customers to use leverage of up to 100 times their collateral and then automatically liquidated positions at prices the plaintiffs argue were set while collateral remained allegedly sufficient to cover the losses. The plaintiffs claim that collateral was still worth twice the losses they say were ultimately incurred during liquidations.
In the plaintiffs’ account, remaining BTC after liquidation was directed into BitMEX’s insurance fund. They argue that this structure allowed the exchange to profit from forced liquidations rather than limit losses strictly to what was necessary under liquidation rules.
Central to the fraud allegations is the plaintiffs’ contention that BitMEX “deliberately developed a system that profited from the liquidations.” The complaint further asserts that an internal desk had access to private customer information and could keep trading while ordinary users allegedly could not access or close positions during server freezes.
Cointelegraph contacted BitMEX for comment but did not receive a response before publication.
Who is suing, and what relief is being sought
The proposed class action seeks the return of allegedly withheld Bitcoin and requests compensatory and punitive damages. The plaintiffs aim to represent US customers who purchased BTC swap products in transactions dating back to July 23, 2018, according to the filing.
The complaint identifies the alleged losses by plaintiff: BKX Services Inc. is said to have lost at least 305.81 BTC, while David Namdar alleges losses exceeding 316.85 BTC. The lawsuit states that the combined total losses alleged across the named plaintiffs amount to 622.66 BTC.
Notably, the new case explicitly frames the dispute around how collateral was handled after liquidations and how access to trading tools may have differed between internal participants and regular customers during alleged service disruptions.
Background: earlier BitMEX class action and a renewed push
While the new filing revives longstanding scrutiny of BitMEX’s internal trading operations and liquidation engine, it is not the first time traders have attempted to pursue legal claims. The complaint references a class action filed in 2020 by Brett Messieh and other traders alleging similar conduct.
That earlier case, which included claims under the Commodity Exchange Act, was voluntarily dismissed without prejudice on June 30, 2025. The renewed lawsuit therefore raises the question of how plaintiffs plan to refine or reframe their allegations after that dismissal and what evidence they believe supports the renewed claims.
For BitMEX users, the shift matters because earlier proceedings ended without a final resolution on the merits. A refiled suit suggests plaintiffs believe they can proceed more effectively—whether by adjusting legal theories, assembling additional factual support, or both.
Filed as BitMEX moves toward shutdown
The lawsuit was filed the same day BitMEX announced it would close after 11 years in operation. In its shutdown plan, BitMEX said it would stop providing services on Sept. 23, following a strategic review by HDR Global Trading.
BitMEX has already stopped accepting new registrations. The exchange also plans to prevent users from opening new positions starting on Aug. 26, according to the announcement. The timing is likely to be closely watched by affected traders and counterparties, as the platform’s winding down could affect how quickly claims can be assessed and how remaining customer-related matters are handled operationally.
BitMEX’s closure announcement was also followed by sharp market moves in the exchange’s BMEX utility token, with Cointelegraph reporting a roughly 90% plunge after the shutdown news. While token volatility does not determine the legal merits of the allegations, it underscores the broader uncertainty and reputational pressure that frequently accompany shutdowns and litigation.
Earlier coverage from Cointelegraph noted that BitMEX had already begun delisting a large number of trading pairs and derivatives in July amid its exchange shutdown process.
What to watch next
As the case heads through initial US court steps, the key unknowns will be how the allegations are supported procedurally and factually, and whether BitMEX responds with challenges to the plaintiffs’ theory of fraud and the causal link between alleged liquidation behavior and the claimed Bitcoin losses. With BitMEX preparing to exit the market by Sept. 23, plaintiffs and users will also watch how the shutdown affects evidence access, user documentation, and the practical timeline for any potential recovery.
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