[Update 07:24 UTC, July 24: Adds BitMEX response in fifth paragraph.]

BitMEX is facing a class-action lawsuit accusing the cryptocurrency platform of fraudulently planning to liquidate customers in order to seize Bitcoin collateral from traders.

On Thursday, BKX Services Inc. and David Namdar filed complaint to the United States District Court for the Southern District of New York. The plaintiffs claim they lost a total of 622.66 BTC as a result of BitMEX’s forced liquidation, with BKX claiming losses of at least 305.81 BTC and Namdar claiming losses in excess of 316.85 BTC.

The lawsuit revives long-standing allegations about the platform’s internal trading operations and liquidation mechanism, and comes as the exchange prepares to close in September.

“BitMEX intentionally developed a system that profited from liquidation,” the plaintiffs alleged. The complaint alleged that the internal trading desk had access to private customer information and was able to continue trading during a server freeze that prevented regular users from accessing or exiting their positions.

“BitMEX has had many such claims against the platform in its history and has successfully handled each of them,” a BitMEX spokesperson told Cointelegraph. “This is another opportunistic claim with no basis; this time we look forward to defending ourselves vigorously again.”

BitMEX Users Demand Bitcoin Returns Amid Fraud Claims

According to the filing, BitMEX allowed customers to exploit leverage of up to 100 times the value of the collateral and then automatically liquidated positions while the collateral was still allegedly worth twice the losses incurred.

The remaining BTC was placed in the platform’s insurance fund, allowing BitMEX to profit from forced liquidations, plaintiffs claim.

The plaintiffs are seeking the return of the allegedly withheld Bitcoin, as well as compensatory and punitive damages. Their purpose is to represent U.S. clients who purchased BTC swap products in transactions dated July 23, 2018.

Related: BitMEX Delists 65 Trading Pairs and Derivatives in July Due to Exchange Closure

The complaint also points to a class action lawsuit filed in 2020 by Brett Messieh and other entrepreneurs alleging similar conduct. This case, which was the subject of claims under the Commodity Exchange Act, was voluntarily and without prejudice dismissed on June 30, 2025.

Lawsuit goes to court as BitMEX announces closure

The proposed class action lawsuit was filed on the same day that BitMEX announced its closure after 11 years of operation.

BitMEX said it would stop providing services on September 23 following a strategic review by its owner, HDR Global Trading.

It has stopped accepting recent registrations and plans to prevent users from opening recent positions from August 26. Following the announcement, there was a drop of approximately 90% in the value of the BMEX BitMEX utility token.

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