UK Trader Targets 1,053 Losing BitMEX Trades in £20 Million Claim

A British software engineer is seeking 324.8 Bitcoin, or damages of equivalent value, from HDR Global Trading Limited, the operator of BitMEX, over perpetual swap trades he says the exchange was not authorised to offer in the UK. As of October 1, the claim is valued at £20.4 million.

Lewis Barber placed roughly 2,294 trades on the platform through five accounts between 2018 and 2022, according to the claim. His lawsuit challenges 1,053 of them — all of which lost money — and does not ask the court to revisit the rest of his trading. He wants the Bitcoin lost on those trades returned.

The unauthorised activity argument

Barber's case rests on Section 26 of the Financial Services and Markets Act 2000, which allows a customer to seek the return of money or property transferred under an agreement made during unauthorised regulated activity. He argues BitMEX entered into the disputed perpetual swaps without the authorisation required in the UK.

The court has not yet decided whether that provision covers the trades in question, or how much Barber could recover. Even if an authorisation breach is proven, Section 28 lets a court enforce the agreement, or allow the provider to keep the transferred property, if it considers that just and equitable.

Barber's argument also turns on BitMEX's activity in the UK. The claim says the platform allowed users to select the country as their place of residence and did not block access from there, and it cites a BitMEX advertisement published in The Times in January 2019. In March 2020, while Barber was still trading, the Financial Conduct Authority warned that BitMEX might be providing financial services or products in the UK without authorisation. That warning did not determine whether his particular trades breached UK rules; the question remains part of his case.

His lawyers at Seladore Legal are inviting other former UK-based BitMEX clients to register their interest, saying they will assess each person's trading history and circumstances before deciding whether a claim is viable. No group claim has been filed.

The action sits alongside a separate UK case in which 1,692 traders allege that Binance sold them derivatives it was not authorised to offer. Neither case has established liability for the exchange concerned.