Samuel Reed, BitMEX co-founder and former CTO, signed a $ 5 million unsecured presence guarantee to release him pending trial.
Reed was arrested by the U.S. Department of Justice in Massachusetts on Oct. 1 for violating money laundering regulations in violation of the Bank Secrecy Act, and for illegally offering commercial derivatives to U.S. retail customers.
According to the Justice Department, Reed’s co-founders and partners, Arthur Hayes, Ben Delo and Gregory Dwyer, remain charged with the same charges, “on bail”.
Reed’s $ 5 million bail will be canceled if he does not appear in court or surrender to serve a sentence the court can impose, according to court documents approved on October 1. Under the defendant’s agreement, Reid deposited $ 500,000 in cash.
In the Justice Department’s indictments, Reed, Hayes, Delo and Dwyer are accused of conducting an alleged “offshore” cryptocurrency exchange while deliberately failing to implement or maintain basic money laundering rules. In doing so, they allegedly allowed BitMEX to operate “as a platform in the shadow of the financial markets.”
Along with the Department of Justice’s claims, the US Commodity Futures Trading Commission filed a civil lawsuit in the Southern District of New York against Reed, Hayes, Delo and several BitMEX entities.
Yesterday, one of these organizations, BitMEX Operator 100x Group, announced that the three co-founders would no longer be in leadership roles and immediately assigned employees to replace them. Dwyer, who participated in the Justice Department’s procedure, but not the CFTC, will take a break from his role as head of business development.
Following the news of the allegations, some cryptocurrency commentators criticized BitMEX for damaging the reputation of the industry as a whole and possibly strengthening the position of regulators vis-à-vis the sector.