BitMEX Operator Sued in UK for Return of 324.8 Bitcoin...Unlicensed Derivatives at Issue

The operator of crypto derivatives exchange BitMEX, HDR Global Trading, has been sued in the UK High Court for the return of 324.8 bitcoin, The Guardian reported on October 14 UK time. The claimant, software engineer Lewis Barber, is seeking the return of bitcoin lost in derivatives trades between 2018 and 2022.

Barber argues that because BitMEX offered derivatives without authorization from the UK Financial Conduct Authority (FCA), he is entitled under the Financial Services and Markets Act (FSMA) to recover the bitcoin he lost in those trades. He is also seeking damages for deceit, alleging that the company acted as though the trades could be conducted lawfully.

The FCA warned in March 2020 that BitMEX might be operating without authorization. As of the October 14 report, the claim documents had not yet been served on the company, and the court had not ruled on whether the restitution claim would be recognized or on its scope.

Metanomia View

This lawsuit asks whether an overseas exchange's lack of operating authorization can lead to restitution liability for transactions that have already taken place. It is notable because regulatory compliance may affect not only future operations but also the enforceability of past contracts and their settlement outcomes. The case remains at the claimant's allegation stage, and the court has not ruled on whether the restitution claim will be recognized or on its scope.

Sources