Bitmex accelerates user verification program after anti-money laundering charges

Bitmex has brought forward its user ID verification program after the company was charged with installing lax anti-money laundering controls

Cryptocurrency exchange Bitmex announced earlier today that it would launch its User Verification Programme for individual and Bitmex corporate customers earlier than expected. The exchange would launch the program starting November 5, three months earlier than the previous deadline of early February 2021.

Bitmex is making these moves after the United States government and a regulator accused it of facilitating unregistered trading. As per the charges, the exchange has lax anti-money laundering controls in place at the moment.

In its blog post, Bitmex stated that “We are introducing changes to accelerate the rollout of our User Verification Programme for individual and Bitmex corporate customers. Users must now be fully verified by November 5, 2020, at 00:00 UTC to continue trading on the platform”.

Once the ID verification process begins, unverified traders won’t be able to open new positions. Furthermore, starting from December 4 at 00:00 UTC, the unverified users will not be able to withdraw funds from their Bitmex account unless they complete their ID verification.

Bitmex started this move in August when it announced the Bitmex User Verification Programme. As per the original announcement, the programme was scheduled to launch in early February 2021, and all customers were required to complete ID checks. The new controls will enable Bitmex to create a secure and trusted trading environment.

Earlier this month, the U.S. Commodity Futures Trading Commission (CFTC) and federal prosecutors charged Bitmex with facilitating unregistered trading and other violations. According to the Assistant FBI Director William Sweeney Jr., Bitmex and its owners bragged about their company incorporated in a jurisdiction outside America. It costs lower to bribe regulators in that jurisdiction as compared to the U.S.

The CFTC accused Bitmex of receiving $11 billion in Bitcoin deposits and earning over $1 billion in fees. The exchange did this while conducting most of the company’s business in the United States and accepting orders and funds from customers in the country.

The charges brought against Bitmex has seen the crypto exchange fast-forward its User Verification Programme to avoid further trouble from the regulators. Bitmex stated that “Recent events have underscored the requirement for market operators to implement robust and compliant KYC programmes”.

Bitmex announced in August that it would be launching a trading tournament for traders who have completed verification. However, the latest development has forced the exchange to delay the tournament until a later date.