Celsius Network’s bankruptcy estate has sued BitMEX over a 2020 liquidation cascade it says cost more than 6,360 Bitcoin.
The complaint, filed Sept. 12 in the US Bankruptcy Court for the Southern District of New York, accuses entities behind the crypto derivatives exchange of fraud, market manipulation and wrongful liquidations during Bitcoin’s historic March 2020 selloff.
Celsius is seeking to recover losses tied to 6,360 BTC, worth roughly $495 million around the time of the filing.
Blockchain Recovery Investment Consortium, or BRIC, brought the case on behalf of Celsius entities as the bankrupt lender’s litigation administrator and complex asset recovery manager.
The defendants include Seychelles-based HDR Global Trading Ltd., Hong Kong-based ABS Global Trading Ltd. and Shine Effort Inc. Ltd., along with Bermuda entities 100x Holdings Ltd. and HDR Global Services Ltd. They collectively operated under the BitMEX name.
The filing comes as BitMEX prepares to shut down its exchange on Sept. 23, giving Celsius a new recovery target just days before one of crypto’s longest-running derivatives venues stops trading. BitMEX announced the closure in July after what it described as a strategic review of its business and the broader industry.
Notably, this marks the second major lawsuit against BitMEX since it announced its intention to wind down operations.
Complaint targets BitMEX’s liquidation engine
The case turns on how BitMEX handled leveraged positions as Bitcoin plunged during the March 12, 2020 market panic.
Celsius alleges BitMEX’s conduct during the crash resulted in wrongful liquidations and the seizure of digital assets belonging to Celsius and investment-fund group JST.
The complaint describes the losses as stemming from the exchange’s fraudulent misconduct and market manipulation. The filing stated:
“While BitMEX made multiple representations that it would maintain an orderly market for its derivatives contracts, BitMEX knew these representations were false. Instead of maintaining an orderly market, BitMEX intentionally designed its platform and liquidation procedures to cause liquidations of collateral and defraud its own customers.”
Bitcoin fell sharply that day as the emerging coronavirus pandemic triggered a broad rush out of risk assets.
The selloff pushed the cryptocurrency from about $7,200 to a 10-month low near $5,678 within roughly 15 minutes at one stage, while about $702 million of positions were liquidated on BitMEX during the initial crash. Nearly all of those liquidations were long positions.
The episode became one of the defining stress events for crypto derivatives markets. BitMEX was then a dominant venue for highly leveraged Bitcoin trading, meaning falling prices could automatically force the exchange’s liquidation system to close positions that no longer met margin requirements.
Those forced sales could add fresh sell pressure to an already falling market, creating the potential for successive rounds of liquidations as prices declined.
Celsius’ lawsuit seeks to turn that market event into a recoverable bankruptcy claim more than six years later. The estate must show that its losses flowed from actionable misconduct by BitMEX rather than from the extreme volatility and contract mechanics that traders accepted when opening leveraged positions.
That distinction is likely to become central if the defendants challenge the claims. The complaint’s allegations remain unproven, and the court has yet to determine whether BitMEX or its related entities are liable for the Bitcoin Celsius says it lost.
A recovery target Celsius identified years ago is finally in court
The lawsuit turns a potential claim Celsius first identified in 2023 into an active recovery effort at a critical moment for BitMEX.
A September 2023 bankruptcy filing listed HDR Global Trading Ltd., which operates as BitMEX, among possible litigation targets for claims involving negligence, fraud and market manipulation.
Those claims were later transferred into Celsius’ broader post-bankruptcy recovery process after BRIC was appointed in 2024 to pursue litigation and other complex assets on behalf of creditors.
BRIC has already generated proceeds from that mandate. In October 2025, Celsius reached a $299.5 million settlement with Tether following litigation brought by the estate.
The BitMEX complaint adds another potentially large claim to that campaign, but it comes as the exchange winds down operations.
BitMEX stopped accepting new accounts after announcing its closure and began limiting customers’ ability to increase positions in late August. It has since been settling and delisting contracts ahead of the Sept. 23 shutdown, including the early settlement of several BTC and ETH perpetual swaps and futures on Sept. 16.
The company has said the closure was not prompted by financial distress, a hack or immediate regulatory pressure. It has also said customer assets exceed liabilities and that users will retain access after trading ends to withdraw remaining balances.
That timetable has shifted attention toward whether Celsius will seek additional measures while the wind-down is still underway.
Simon Dixon, a prominent Celsius creditor and longtime commentator on the bankruptcy, said the timing suggests the litigation administrator may be considering more than a damages award that could take years to obtain.
He said filing before a company completes a wind-down can help preserve claims against assets, entities and counterparties before corporate structures or holdings change. Dixon stressed, however, that there is no evidence Celsius has obtained an injunction blocking the closure or restricting asset transfers.
He said he would now watch for any effort by BRIC to seek an injunction, preserve assets or otherwise limit transfers while the exchange shuts down. Any such move would require separate legal action or court approval.
For now, the complaint leaves BitMEX’s closure schedule intact. The entities named in the lawsuit remain defendants after trading stops, meaning the case can continue even after the exchange ceases operations.
Their response will help determine whether the dispute proceeds to discovery into BitMEX’s 2020 trading and liquidation systems or faces an early challenge on jurisdiction, limitation periods, or the legal sufficiency of Celsius’ claims.
