BitMEX management negotiates participation in lawsuit

Clearing the air – BitMEX management negotiates participation in lawsuit

The crypto trading platform’s directors set conditions for US authorities to voluntarily extradite them.

Arthur Hayes, the former chief executive officer (CEO) of crypto trading platform BitMEX, is negotiating with US legal authorities over his return to the US as part of the indictment of him and the rest of the management team.

According to the transcript of a 16 February conference call between the prosecution and the presiding judge, he plans to turn himself in on 6 April in Hawaii. The CEO of the crypto-derivatives trading platform Crypto Revolt is accused by the US Department of Justice and the derivatives trading regulator (CFTC) of violating US money laundering law together with his colleagues.

According to the report, prosecutor Jessica Greendwood has been in talks with Hayes about voluntary extradition for some time. Hayes is currently still in Singapore and wants to remain resident here, but has agreed to enter the USA for the preliminary hearing and possible trial dates.

“We have negotiated with his lawyers the terms of a voluntary extradition, whereby he has proposed to first enter the US in Hawaii and turn himself in here,” Greenwood said. And further:

“He would turn himself in in Hawaii, then appear in court via video link for the preliminary hearing and then travel back to Singapore. If needed, he would come back to the US if the case went to trial in New York.”

Further, Greenwood disclosed in the conference call that co-owner Ben Delo plans to turn himself in in New York later this month. As part of this, prosecutors are already working with the Federal Bureau of Investigation (FBI) and Border Patrol (Customs) to obtain an entry permit for Delo, who is still in the UK and subject to a Corona-related entry ban.

Co-founder Greg Dwyer continues to refuse voluntary extradition, which is why the US Attorney’s Office is now negotiating with the resident authorities.

“As for the other three defendants [besides Hayes], we are in contact with their lawyers about appearing in the US. They have all given various conditions and dates for their entry,” as Greenwood explains. To this she adds:

“At this time, however, we have no assurances that they will actually appear.”

BitMEX CTO Samuel Reed was already arrested in the US state of Massachusetts shortly after the charges against the crypto trading platform came to light in October 2020. Reed was subsequently released on US$5 million bail, but must be present for the preliminary hearing and any court hearings.

In light of the information provided by the prosecution, the presiding judge ruled that a trial could not yet begin due to the uncertain situation, so another preliminary hearing was initially scheduled for May.

Last month, Hayes had broken his silence for the first time after the allegations came to light, directly causing trouble again by advising small investors to turn away from traditional finance, which was an allusion to the recent affair involving GameStop, Robinhood and the Reddit forum r/WallStreetBets.

Arthur Hayes is considered one of the crypto industry’s most colourful personalities

The former Wall Street trader turned his back on high finance in 2013 and subsequently built the controversial crypto trading platform BitMEX together with Delo, Reed and Dwyer. Here, traders could trade crypto derivatives with up to 100-fold leverage, which caused fierce criticism, as the prices of cryptocurrencies already fluctuate greatly. However, the liquidity gained through the platform was also an important developmental step for the market. Vanity Fair traced the history of Hayes and BitMEX in a detailed article at the beginning of February.