BitMEX Hit With Lawsuit Over Forced Bitcoin Liquidations

Crypto derivatives exchange BitMEX is facing a fresh class action lawsuit just as it prepares to shut down operations. The legal complaint, filed in the US District Court for the Southern District of New York, accuses the exchange of deliberately engineering customer liquidations to take possession of excess Bitcoin collateral. Plaintiffs BKX Services Inc and investor David Namdar claim they collectively lost 622.66 Bitcoin through these forced liquidations.

According to the lawsuit, the platform designed its liquidation system to profit from traders rather than protect them during market swings. The plaintiffs argue that positions were liquidated even when remaining funds exceeded the required amount to cover losses, and BitMEX allegedly kept the leftover money instead of returning it. The complaint also points to server outages during high volatility, which stopped traders from saving their positions before automated liquidations took effect.

The timing of the lawsuit lands on the exact day BitMEX announced plans to shut down its business entirely by September 23, 2026. While the exchange told users to withdraw their funds and close open positions, this new legal action brings old questions about its trading engine back into the spotlight. Traders should monitor how the court handles these severe allegations as the platform winds down its final weeks.