BitMEX, a cryptocurrency derivatives trading platform is restricting three more jurisdictions from accessing its platform, according to a Mondy announcement from the company.
Although located in Seychelles, BitMEX has restricted users from Seychelles, Hong Kong, and Bermuda from using its services. The company explains that the restrictions are to provide “safety of the funds and the stability of the platform.”
In a twist, the restricted jurisdictions are areas in which BitMex’s Parent company, HDR Global Trading Limited, is located. BitMEX has reassured that the restriction will have minimal impact on its users in the affected areas. In its blog post, the company states, “This change will have no financial impact on the business and will affect very few people. The BitMEX team will be reaching out to those who are affected.”
Furthermore, in its terms of service, HDR lists other restricted jurisdictions. It also explains that it holds the right to close down any account suspected to be accessing their services from restricted areas.
The terms of service reveal that if a user gives “false representations as to your location of incorporation, establishment, citizenship or place of residence, HDR reserves the right to close any of your accounts immediately and liquidate any open positions.”
Despite reassurance from BitMEX, fingers are still pointing at the possible regulatory probe by the United States Commodity Futures Trading Commission (CFTC) as the cause of the restriction. BitMEX is not registered with the CFTC, and the U.S is also on its restricted jurisdiction list. The regulator investigation was to determine if BitMEX had broken its regulations by allowing American traders to gain access to its services.
Also, the trading platform recently received a backlash from the U.K. Advertising Standards Authority for misleading information. According to the U.K. Ad authority, BitMEX had published misleading information concerning a Bitcoin price graph on the front page of the Times newspaper.
Per the claims, BitMEX had reached an ad code by showing the price difference of a Bitcoin price graph in January 2009 and January 2019. the authority claimed that the advertisement was “a clear promotional statement of Bitcoin’s merits and did very little to warn consumers of any risks.” BitMEX, however, refuted the claims.