Stephen Palley gives an in depth look at the BitMEX charges — and what it could mean for DeFi regulation

Episode 40 of Season 2 of The Scoop was recorded remotely with The Block’s Frank Chaparro and Stephen Palley, partner at Anders0n Kill.

Listen below, and subscribe to The Scoop on AppleSpotifyGoogle PlayStitcher or wherever you listen to podcasts. Email feedback and revision requests to [email protected]

advertisement

Last Thursday, BitMEX found itself embroiled in both a civil and criminal case with the Commodities Futures Trading Commission (CFTC) and the Department of Justice (DOJ), respectively. 

BitMEX was hit by twin lawsuits. The CFTC accused the derivative exchange and its operators, including CEO Arthur Hayes and co-founders Ben Delo and Samuel Reed, of running an unregistered trading platform and violating anti-money laundering and know-your-customer regulations.

The DOJ filed a criminal indictment against Hayes, Delo, Reed and head of business development Greg Dwyer for allegedly violating the Bank Secrecy Act. Reed himself was arrested. 

Responding to the breaking news developments, Stephen Palley, partner at Anderson Kill, featured on this week's episode of The Scoop to break down the nuances of the two cases. He touched on:

  • The process for litigating Bank Secrecy Act violations, and why it's likely the BitMEX operators are likely on the hook for possible prison time
  • What this case means for the growing decentralized finance space
  • Key facts in each filing that will be impactful going forward
  • Why it's surprising that the BitMeX domain has not been seized by law enforcement

© 2022 The Block Crypto, Inc. All Rights Reserved. This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

Trending Stories

Get Your Crypto
Daily Brief

Delivered daily, straight to your inbox.

Will Sanctions Drive Russia into the Arms of Cryptocurrencies?

From the removal of many Russian banks from SWIFT to a seemingly constant flow of new sanctions, Russia’s invasion of Ukraine has left many to wonder: Is the country likely to lurch towards cryptocurrencies? And if so, what does this mean for businesses that are holding and/or using crypto? Crypto and sanctions evasion Although crypto […]
Read Full Story
Sponsored Post

Layer-2 Scaling Solutions: A Framework for Comparison - Commissioned by Polygon

Ethereum had a breakout year in 2021. It’s native asset, ETH’s, market capitalization surpassed $500 billion for the first time. Its network facilitated upwards of $7 trillion value transfer. Non-fungible tokens (NFTs) emerged as another “killer application” that have put its technology on the global stage and caught the attention of the masses.
Read Full Story
May 5, 2022, 3:17PM UTC
More