A British software engineer is suing the operator of crypto derivatives exchange BitMEX for the return of 324.8 Bitcoin, worth about £20.4 million on October 1, alleging the exchange conducted regulated activities in the UK without authorisation from the Financial Conduct Authority.
Lewis Barber, a UK software engineer, filed the claim in London's Commercial Court against HDR Global Trading, the operator of BitMEX. The claim covers around 2,294 trades Barber executed on the exchange between 2018 and 2022 from five accounts. He is challenging the 1,053 trades that resulted in losses.
All of the disputed trades were perpetual swaps, a type of derivative similar to futures contracts but with no expiry date. The claim argues that each trade was a regulated activity under the Financial Services and Markets Act 2000, and that BitMEX was not authorised by the FCA to carry out such activities in the UK. Consequently, the claim contends, none of the contracts can be enforced against Barber.
Barber's lawyers have indicated that other UK traders may have similar claims, potentially amounting to hundreds of millions of pounds in total.
BitMEX, a major crypto derivatives exchange, shut down in September. The operator has not yet publicly responded to the claim.
Analysis
Why This Matters
- The case could set a precedent for UK traders to reclaim losses from unlicensed offshore crypto exchanges.
- If successful, the claim may open the door for a wave of similar lawsuits, potentially running into hundreds of millions of pounds.
- The outcome will test the application of UK financial regulation to decentralised and cross-border crypto trading platforms.
Background
BitMEX, founded in 2014, was one of the first cryptocurrency exchanges to offer leveraged derivatives trading. It has previously faced regulatory scrutiny, including charges from US authorities in 2020 for violating the Bank Secrecy Act and operating an unregistered trading platform. The exchange shut down its operations in September 2025. UK financial regulation requires firms offering derivatives to retail clients to be authorised by the FCA, a requirement the claim argues BitMEX ignored.
Key Perspectives
Lewis Barber (claimant): Seeks the return of his Bitcoin deposits on the grounds that the trades were legally void due to the operator's lack of FCA authorisation. His legal team argues that UK consumer protection law should apply to all financial promotions and trading activities directed at UK residents.
HDR Global Trading (BitMEX operator): Has not yet filed a defence. Likely to argue that its platform was not directed at UK residents, that Barber traded willingly, and that the contracts fall outside UK regulatory jurisdiction.
Other UK crypto traders and legal observers: Lawyers for Barber say other UK traders may consider similar claims, which could aggregate into significant liability. The case may prompt the FCA to take enforcement action against other unlicensed crypto derivatives providers.
What to Watch
- The court's decision on jurisdiction and whether it accepts the claim that perpetual swaps are regulated activities under FSMA 2000.
- Any response or statement from BitMEX's operator.
- The potential emergence of additional claims from other UK traders.
- Possible FCA action or guidance on crypto derivatives offered to UK residents by offshore exchanges.