BitMEX Forbidden For US Traders?

BitMEX has recently been indicted by US prosecutors. The prosecutors suspect the Bitcoin Mercantile Exchange of having circumvented US anti-money laundering laws. In addition, the BitMEX management is alleged to have violated the US law on banking secrecy, as they haven’t had KYC before 2020. Of course BitMEX’ lawyers will do everything they can to refute these accusations. For the time being, the outcome of these charges remains to be seen (as of October 7, 2020).

BitMEX USABitMEX is known as world’s No1 margin trading platform for Bitcoin. In July 2018, believe it or not, the big broker firm reached 1,000,000 Bitcoin being traded on their platform on a single day for the very first time. At a price level of round about 7000 USD that was already a total US Dollar value of about 7 billion.

BitMEX is one of the few brokers where Bitcoin can be traded with up to 100x leverage which is one of the most outstanding features of the Bitcoin broker. Also they have a highly professional trading engine featuring advanced order types such as stop orders, trailing stops, take profit orders and a range of other helpful settings to automate processes. Once you’ve got how the system works you see that it’s super fast and easy to manage.

The extremely high daily trading volume was even reached in a time when US traders had already been banned since a while.

Brokers And Exchanges Where US Traders Are Allowed:

  • Bitcoin Purchase
  • Altcoin Purchase
  • USD, EUR supported
  • Regulated & secure
  • No margin trading

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  • Bitcoin Purchase
  • Crypto Trading
  • No service for:
    NY & WA state
  • 5x Leverage

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  • Bitcoin Purchase
  • Bitcoin Trading
  • Altcoin Trading
  • USD, EUR, GBP, RUR
  • 3x Leverage

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  • Bitcoin Purchase
  • Altcoin Purchase
  • USD,EUR,GBP
  • High Liquidity
  • No margin trading

Visit Platform

  • Bitcoin Purchase
  • Altcoin Purchase
  • USD, EUR supported
  • Trusted Exchange
  • No margin trading

Visit Platform

Why Are US Customers Not Allowed To Trade on Bitmex?

Researching the American legislation regarding cryptocurrency trade is a bit laborious, as one has to gather the individual pieces of information on the websites of the corresponding authorities. We have tried to find the right information and hope that we understand and interpret it correctly. For this we give no guarantee :), but it should be approximately as follows:

In the USA, high leveraged CFD trading is generally prohibited. US citizens and residents are allowed to trade in financial markets, but trading of derivatives with leverage is generally excluded.

In this context, the regulations of different supervisory authorities play together. The national supervisory authorities CFTC is the authority that generally classifies trading objects. At their discretion, cryptocurrencies currently count as commodities.

Another authority whose regulations apply here is the SEC. It regulates the trading of futures and derivatives and unfortunately does not allow trading with high leverage for cryptocurrencies.

The third authority to be mentioned in connection with cryptocurrency trade in the U.S. is the FINCEN – the authority that fights money laundering. The FINCEN requires traceable transactions and absolute transparency with regard to sender and recipient. Trading platforms and brokers in the USA must therefore insist on ID verification of their customers.

Outside the US American jurisdiction, however, there is usually no legal requirement for crypto brokers to perform ID verification as long as there is no Fiat money exchange involved. That’s why BitMEX and similar trading companies don’t have KYC by default. Due to legal pressure, however, KYC is now mandatory with BitMEX.

The bottom line is that in the USA cryptocurrency trade may be operated legally, but only in the form of spot market trades. So cryptocurrencies can be bought and sold directly, but not in the form of CFDs.

The maximum possible leverage that Bitcoin traders are allowed to use is offered by Kraken. At this exchange, which is regulated and licensed in the USA, Bitcoin & Co can be bought and sold directly, whereby traders may use a leverage of up to 5x in “Advanced Trades”. Kraken also offer Futures – but of course this high leveraged trading product cannot be used by US citizens and residents. The company can guarantee this exclusion through mandatory ID verification.

BitMEX Had To Ban US Customers For Good

For the reasons mentioned above, BitMEX must generally exclude traders from the USA. Therefore, this notice is clearly stated on their website. In addition, BitMEX does not allow any unauthorized website access from the USA. This means that traders logging in from the USA are immediately required to undergo ID verification.

When Will BitMEX Be Officially Available To US Citizens?

There is no way that BitMEX could ever allow US traders, as long as they offer high leveraged derivatives only and as long as such are forbidden in the USA.

So Which Countries Are Allowed?

There are several geo restrictions mentioned in BitMEX’s terms and conditions. Those concern the USA (also any country, state or other jurisdiction that is embargoed by the USA), the Canadian provinces of Ontario and Québec, the Republic of Seychelles, Hong Kong, Crimea and Sevastopol, Bermuda, Cuba, Syria, Iran, Sudan or North Korea. The rest of the world is generally allowed. However, if you come from a country that bans crypto-related sites by default you might possibly not be able to use BitMEX. Using VPN to bypass geo restrictions would be illegal in this case and is therefore definitely not recommended.

Disclaimer: This post is not financial advice. It’s only shared information based on our own research and experience. Under no circumstances is the author responsible for the trading activities of readers. We are neither liable for legal issues nor financial losses of readers.

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