Celsius Community’s chapter property has sued BitMEX over a 2020 liquidation cascade it says value greater than 6,360 Bitcoin.
The criticism, filed Sept. 12 within the US Chapter Courtroom 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 in search of to recuperate losses tied to six,360 BTC, value 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 embody Seychelles-based HDR International Buying and selling Ltd., Hong Kong-based ABS International Buying and selling Ltd. and Shine Effort Inc. Ltd., together with Bermuda entities 100x Holdings Ltd. and HDR International 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 considered one of crypto’s longest-running derivatives venues stops buying and selling. BitMEX introduced the closure in July after what it described as a strategic assessment 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.
Criticism targets BitMEX’s liquidation engine
The case activates how BitMEX dealt with leveraged positions as Bitcoin plunged throughout the March 12, 2020 market panic.
Celsius alleges BitMEX’s conduct throughout the crash resulted in wrongful liquidations and the seizure of digital property belonging to Celsius and investment-fund group JST.
The criticism 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 might preserve 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 clients.”
Bitcoin fell sharply that day because the rising coronavirus pandemic triggered a broad rush out of threat 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 throughout 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 may robotically power the trade’s liquidation system to shut positions that not met margin necessities.
These compelled gross sales may add recent promote stress 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 somewhat than from the intense volatility and contract mechanics that merchants accepted when opening leveraged positions.
That distinction is more likely to develop into central if the defendants problem the claims. The criticism’s allegations stay unproven, and the court docket has but to find out whether or not BitMEX or its associated entities are chargeable 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 lively restoration effort at a crucial second for BitMEX.
A September 2023 chapter submitting listed HDR International Buying and selling Ltd., which operates as BitMEX, amongst potential 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 criticism provides one other probably massive declare to that marketing campaign, however it comes because the trade winds down operations.
BitMEX stopped accepting new accounts after asserting its closure and commenced limiting clients’ skill 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 stress. 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 further measures whereas the wind-down continues to be underway.
Simon Dixon, a distinguished 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 might take years to acquire.
He mentioned submitting earlier than an organization completes a wind-down may also help protect claims in opposition to property, entities and counterparties earlier than company buildings or holdings change. Dixon confused, nonetheless, that there isn’t a proof Celsius has obtained an injunction blocking the closure or proscribing 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 criticism 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 durations, or the authorized sufficiency of Celsius’ claims.
