Celsius Community’s chapter property has sued BitMEX over a 2020 liquidation cascade it says value greater than 6,360 Bitcoin.
The grievance, filed Sept. 12 within the US Chapter Court docket for the Southern District of New York, accuses entities behind the crypto derivatives trade of fraud, market manipulation and wrongful liquidations throughout Bitcoin’s historic March 2020 selloff.
Celsius is searching for to get better losses tied to six,360 BTC, price roughly $495 million across the time of the submitting.
Blockchain Restoration Funding Consortium, or BRIC, introduced the case on behalf of Celsius entities because the bankrupt lender’s litigation administrator and complicated asset restoration supervisor.
The defendants embrace Seychelles-based HDR World Buying and selling Ltd., Hong Kong-based ABS World Buying and selling Ltd. and Shine Effort Inc. Ltd., together with Bermuda entities 100x Holdings Ltd. and HDR World Companies Ltd. They collectively operated beneath the BitMEX identify.
The submitting comes as BitMEX prepares to close down its trade on Sept. 23, giving Celsius a brand new restoration goal simply days earlier than one among crypto’s longest-running derivatives venues stops buying and selling. BitMEX introduced the closure in July after what it described as a strategic overview of its enterprise and the broader business.
Notably, this marks the second main lawsuit in opposition to BitMEX because it introduced its intention to wind down operations.
Grievance targets BitMEX’s liquidation engine
The case activates how BitMEX dealt with leveraged positions as Bitcoin plunged in the course of the March 12, 2020 market panic.
Celsius alleges BitMEX’s conduct in the course of the crash resulted in wrongful liquidations and the seizure of digital property belonging to Celsius and investment-fund group JST.
The grievance describes the losses as stemming from the trade’s fraudulent misconduct and market manipulation. The submitting said:
“Whereas BitMEX made a number of representations that it could keep an orderly marketplace for its derivatives contracts, BitMEX knew these representations have been false. As an alternative of sustaining an orderly market, BitMEX deliberately designed its platform and liquidation procedures to trigger liquidations of collateral and defraud its personal prospects.”
Bitcoin fell sharply that day because the rising coronavirus pandemic triggered a broad rush out of danger property.
The selloff pushed the cryptocurrency from about $7,200 to a 10-month low close to $5,678 inside roughly quarter-hour at one stage, whereas about $702 million of positions have been liquidated on BitMEX in the course of the preliminary crash. Practically all of these liquidations have been lengthy positions.
The episode turned one of many defining stress occasions for crypto derivatives markets. BitMEX was then a dominant venue for extremely leveraged Bitcoin buying and selling, that means falling costs might robotically power the trade’s liquidation system to shut positions that not met margin necessities.
These pressured gross sales might add recent promote strain to an already falling market, creating the potential for successive rounds of liquidations as costs declined.
Celsius’ lawsuit seeks to show that market occasion right into a recoverable chapter declare greater than six years later. The property should present that its losses flowed from actionable misconduct by BitMEX slightly than from the intense volatility and contract mechanics that merchants accepted when opening leveraged positions.
That distinction is prone to change into central if the defendants problem the claims. The grievance’s allegations stay unproven, and the court docket has but to find out whether or not BitMEX or its associated entities are accountable for the Bitcoin Celsius says it misplaced.
A restoration goal Celsius recognized years in the past is lastly in court docket
The lawsuit turns a possible declare Celsius first recognized in 2023 into an energetic restoration effort at a vital second for BitMEX.
A September 2023 chapter submitting listed HDR World Buying and selling Ltd., which operates as BitMEX, amongst attainable litigation targets for claims involving negligence, fraud and market manipulation.
These claims have been later transferred into Celsius’ broader post-bankruptcy restoration course of after BRIC was appointed in 2024 to pursue litigation and different advanced property on behalf of collectors.
BRIC has already generated proceeds from that mandate. In October 2025, Celsius reached a $299.5 million settlement with Tether following litigation introduced by the property.
The BitMEX grievance provides one other probably massive declare to that marketing campaign, but it surely comes because the trade winds down operations.
BitMEX stopped accepting new accounts after saying its closure and commenced limiting prospects’ capability to extend positions in late August. It has since been settling and delisting contracts forward of the Sept. 23 shutdown, together with the early settlement of a number of BTC and ETH perpetual swaps and futures on Sept. 16.
The corporate has mentioned the closure was not prompted by monetary misery, a hack or rapid regulatory strain. It has additionally mentioned buyer property exceed liabilities and that customers will retain entry after buying and selling ends to withdraw remaining balances.
That timetable has shifted consideration towards whether or not Celsius will search extra measures whereas the wind-down remains to be underway.
Simon Dixon, a outstanding Celsius creditor and longtime commentator on the chapter, mentioned the timing suggests the litigation administrator could also be contemplating greater than a damages award that would take years to acquire.
He mentioned submitting earlier than an organization completes a wind-down will help protect claims in opposition to property, entities and counterparties earlier than company buildings or holdings change. Dixon burdened, nevertheless, that there is no such thing as a proof Celsius has obtained an injunction blocking the closure or limiting asset transfers.
He mentioned he would now look ahead to any effort by BRIC to hunt an injunction, protect property or in any other case restrict transfers whereas the trade shuts down. Any such transfer would require separate authorized motion or court docket approval.
For now, the grievance leaves BitMEX’s closure schedule intact. The entities named within the lawsuit stay defendants after buying and selling stops, that means the case can proceed even after the trade ceases operations.
Their response will assist decide whether or not the dispute proceeds to discovery into BitMEX’s 2020 buying and selling and liquidation methods or faces an early problem on jurisdiction, limitation intervals, or the authorized sufficiency of Celsius’ claims.
