Celsius Network’s bankruptcy estate sued BitMEX for $495 million, alleging the crypto exchange mishandled liquidations during the Bitcoin crash in March 2020.
The lawsuit, filed in New York bankruptcy court, accuses BitMEX and related entities of manipulating its liquidation system and improperly taking customer assets as the market plunged. Celsius is seeking to recover losses tied to about 6,360 Bitcoin.
Celsius Targets BitMEX Liquidations
Bitcoin fell from about $7,200 to as low as $5,678 during the March 12 selloff. BitMEX liquidated about $702 million in positions during the initial market plunge.
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Celsius alleges that BitMEX knew its trading system could trigger a chain of liquidations as prices fell. The allegations have not been proven in court, and the lawsuit does not establish liability against BitMEX.
Lawsuit Filed Before BitMEX Closure
The lawsuit was filed 11 days before BitMEX is scheduled to stop trading on September 23, adding another legal dispute as the exchange prepares to end trading.
Celsius identified BitMEX as a potential litigation target in bankruptcy documents filed in 2023. BRIC later took responsibility for pursuing complex recovery claims on behalf of creditors.
BitMEX has said customer assets exceed its liabilities and that withdrawals will remain available after trading ends. The lawsuit adds another potential recovery claim to Celsius’ bankruptcy estate.
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