Trump exonerates Bitmex co-founder in landmark anti-money laundering case

President Donald Trump issued a full pardon to three co-founders of Crypto Exchange Bitmex on March 27, clearing his name a few years after he admitted to violating US money laundering laws, CNBC reported.

Arthur Hayes, Benjamin Dero and Samuel Reid, who launched BitMex in 2014, each pleaded guilty to charges under the Bank's Secret Law.

pardon

Prosecutors allegedly allowed customers to trade on the platform without proper identity checks, turning the exchange into what they called the hub for illegal financial activities.

In 2022, the three co-founders received probation sentences, raising and paying fines to tens of millions of people to resolve both criminal and civil enforcement actions.

Former CEO Hayes served six months under home confinement. Delo, the company's former strategy director, was sentenced to 30 months of probation, while Reid, who served as CTO, was on 18 months of probation.

Trump's pardon arrived just three months after Bitmex itself agreed to pay $100 million to resolve allegations that it failed to maintain the compliance program needed to detect and prevent money laundering.

Federal prosecutors have accused the company of ignoring legal obligations from American traders. According to court filings, BitMex allowed users to register with only an email address and failed to enforce the natural ban on U.S. customers.

In a statement after the pardon was released, Dero said the charges stemmed from what is called outdated law and political enforcement efforts. He described the pardon as “proof,” claiming that the trio was never charged.

Dero:

“We were mistakenly made to serve as role models.”

Hayes, Delo and Reed paid $10 million in criminal fines each as part of the plea deal in addition to the $30 million civil penalty imposed by the Commodity Futures Trading Commission.

The White House has not issued a formal comment on the pardon.

Bitmex Case

Founded in 2014, Bitmex became one of the earliest and most influential derivative exchanges in the crypto industry, offering users a highly leveraged trading product with minimal registration requirements.

At its peak, the exchange processed billions in daily volumes, attracting users from around the world, including those in the US.

Federal authorities have launched a Bitmex investigation as part of a broader crackdown on offshore platforms that cater to American traders without proper compliance programs.

In 2020, the US Department of Justice and the CFTC submitted parallel actions to the exchange and its founders. Prosecutors accused executives of intentionally avoiding US regulations and not even establishing a basic system to detect or prevent money laundering.

The case was one of the first times the federal government has pursued criminal penalties against crypto exchange operators, setting a precedent for future enforcement actions in the digital assets field.

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