Trump Pardons BitMEX Founders

Trump Pardons BitMEX Founders

Former President Donald Trump issued presidential pardons to BitMEX co-founders Arthur Hayes, Benjamin Delo, and Samuel Reed. This follows a CNBC report detailing the action.

BitMEX and the Charges

BitMEX, founded in 2014, became a significant player in crypto derivatives trading. In October 2020, its co-founders faced indictment for violating the Bank Secrecy Act (BSA). The indictment alleged a failure to implement adequate anti-money laundering (AML) measures and a "know your customer" (KYC) program.

Prosecutors argued BitMEX’s operational model enabled anonymous trading, potentially facilitating illegal activities like money laundering and sanctions evasion. In May 2022, the court imposed a $10 million civil monetary penalty on each founder and prohibited future violations of the Commodity Exchange Act and CFTC regulations.

Individual sentences included two years probation for Hayes, 30 months for Delo, and 18 months for Reed. Following the legal issues, leadership changed in 2020, with Vivien Khoo taking over as interim CEO.

Implications of the Pardons

This pardon adds to Trump’s prior action of pardoning Ross Ulbricht, the founder of Silk Road. The pardons raise questions about regulatory oversight in the cryptocurrency industry and the potential for future legal challenges surrounding similar cases. The effect on the broader crypto market remains to be seen, as does the impact on future AML/KYC compliance efforts.

Codeum: Ensuring Blockchain Security

At Codeum, we are dedicated to strengthening the security of the blockchain ecosystem. Our services include smart contract audits, KYC verification solutions, and custom smart contract and DApp development. We also offer tokenomics and security consultations and work with launchpads and crypto agencies. We believe in building a transparent and secure future for blockchain technology.