BitMEX Confronts Celsius Lawsuit as Exchange Closure Nears

The Celsius bankruptcy estate has filed a lawsuit in the U.S. accusing several BitMEX-linked entities of fraud, market manipulation, and “wrongful liquidations” tied to the March 2020 crypto crash. The complaint alleges that BitMEX improperly liquidated Celsius positions and seized large amounts of Bitcoin during the period when markets rapidly deteriorated.

According to the court filing, Celsius-related plaintiffs seek recovery of Bitcoin worth nearly $490 million as of the time of writing. The complaint was filed on Sept. 12 in the U.S. Bankruptcy Court for the Southern District of New York, and it arrives just days before BitMEX is scheduled to stop exchange services on Sept. 23.

Key takeaways

• The Celsius estate alleges BitMEX liquidations in March 2020 were executed in a way that suppressed Bitcoin prices and drove forced selling.
• The lawsuit targets five entities described as BitMEX-linked, including HDR Global Trading and related firms, and seeks both damages and the return of Bitcoin.
• The filing says BitMEX liquidated 1,325.84 BTC from Celsius on March 12, 2020, and 5,034.33 BTC from investment fund JST on March 13.
• As an evidentiary point, the estate highlights BitMEX’s reported service disruption on March 13, arguing liquidation activity stopped when the platform was unavailable.
• The complaint seeks at least 6,360.16 BTC in actual damages (or its current value) plus additional statutory and punitive claims, with some amounts left to be determined at trial.

Lawsuit details and the estate’s claimed losses

The complaint, filed by Celsius entities acting through estate representative Blockchain Recovery Investment Consortium (BRIC), names five defendants: HDR Global Trading, ABS Global Trading, Shine Effort, 100x Holdings, and HDR Global Services.

In the suit, the estate alleges that BitMEX wrongfully liquidated and seized collateral belonging to Celsius. The filing states that BitMEX took 1,325.84 BTC from Celsius on March 12, 2020, and seized 5,034.33 BTC from an investment fund known as JST the next day. It further says that JST later assigned its related claims to the bankruptcy estate.

The case seeks to recover Bitcoin in kind or, alternatively, its equivalent market value. The estate also requests statutory damages, punitive damages and any applicable treble damages, as well as profits BitMEX allegedly earned from the liquidations and associated legal costs and fees. The complaint does not quantify some additional categories of claims, stating that amounts should be determined at trial.

The timing is notable: the filing was submitted 11 days before BitMEX is scheduled to stop exchange services on Sept. 23. Cointelegraph reported that it contacted both the Celsius estate and BitMEX for comment but did not receive a response before publication.

Allegations of liquidation mechanics and price suppression

At the center of the Celsius estate’s argument is how liquidation prices and execution were allegedly set and triggered during the sell-off. The filing alleges that BitMEX controlled key elements of the liquidation process—specifically, the prices used to trigger liquidations, the system that executed them, and the insurance fund that received proceeds from some liquidation positions.

According to the complaint, certain liquidation sell orders were placed at prices more than 24% below the next-best ask available on BitMEX. The estate also claims that Bitcoin traded at a lower price on BitMEX than on competing exchanges as the liquidation cycle intensified.

For the estate, the implication is that forced selling was not merely a reflection of market panic but was amplified by BitMEX’s internal liquidation engine and related mechanisms. The complaint ties this theory to the sequence of events around mid-March 2020: it argues that liquidation sell orders stopped when the BitMEX platform became unavailable, and that Bitcoin’s price then recovered—evidence, in the estate’s view, that liquidation activity on BitMEX had been suppressing prices.

BitMEX’s March 2020 disruption and what the court filing points to

The estate uses a reported change in BitMEX’s operational status as a factual anchor for its narrative about causation. In the filing, it cites the timing of BitMEX’s March 13, 2020, service disruption, arguing that the interruption corresponds with an end to liquidation activity and subsequent price rebound.

BitMEX had previously acknowledged that it experienced distributed denial-of-service (DDoS) attacks on March 13, 2020, publishing details on March 16 through a blog post. In that post, BitMEX said it faced two DDoS attacks on March 13 at 02:16 UTC and 12:56 UTC.

While the Celsius estate’s complaint characterizes this disruption as supporting evidence that its liquidations contributed to price pressure, the actual legal question for the court remains whether BitMEX’s systems and execution choices amounted to fraud, manipulation, or wrongful liquidation under applicable law.

What the estate is asking for—and how this fits with prior litigation

The Celsius complaint seeks compensation through multiple channels. The estate asks for actual damages of at least 6,360.16 BTC (or the value at current market levels), along with the return of Bitcoin in kind or equivalent value. It also requests statutory damages and punitive damages, as well as any applicable treble damages. The filing includes claims for profits allegedly earned by BitMEX from the liquidations and for legal fees and costs, while leaving certain amounts unspecified pending trial.

This lawsuit is not the only legal action tied to alleged BitMEX liquidation misconduct following the March 2020 crash. Earlier coverage cited a separate proposed class action filed on July 23 by BKX Services and David Namdar. That complaint alleged that the claimants lost a combined 622.66 BTC due to forced liquidations and asserted that an internal trading desk could access private customer information and continue trading during server freezes.

Responding to that earlier case, a BitMEX spokesperson told Cointelegraph the July lawsuit was an “opportunistic claim with no basis,” adding that BitMEX would “vigorously defend itself.” Cointelegraph noted at the time that the statement addressed the July case and was not presented as a response to the Celsius complaint.

Why the case could matter for crypto market structure

Beyond the immediate dispute over seized collateral, the Celsius estate’s filing puts a spotlight on a core issue for leveraged trading venues: how liquidation prices are determined, how execution is carried out during extreme volatility, and how operational disruptions can interact with liquidation triggers.

If the estate’s allegations are accepted in court, the outcome could influence how investors and counterparties evaluate risk around margin trading and liquidation systems—particularly during periods when network congestion, exchange outages, or liquidity gaps can magnify losses.

Readers should watch next for how BitMEX responds to the specific mechanics alleged in the complaint, and whether the court addresses how execution and alleged price impacts will be proven. The degree to which the case turns on the March 2020 disruption timeline—and whether damages are ultimately quantified—may determine how far this dispute extends beyond the Celsius estate’s asserted Bitcoin recoveries.