For cryptocurrency exchanges, offering trading services in a specific location may not be possible or convenient due to a myriad of reasons that are, more often than not, of regulatory nature.
Such is the case with the BitMEX exchange, one of the biggest and most prominent internationally. It recently added three new jurisdiction to its list of trade restrictions, which will join several others that were already present.
In fact, it was BitMEX’s parent company, HDR Global Trading Limited (HDR,) the entity that took the decision. The three newly added jurisdictions are Bermuda, Hong Kong and the Seychelles Islands. The latter happens to be BitMEX’s nation of origin, but it also has branches in Hong Kong and Bermuda.
More Jurisdictions on the List
The other jurisdictions that were originally on the trade restrictions list were Cuba, the United States, the Canadian province of Quebec, Crimea and Sevastopol, Syria, Sudan, Iran, and North Korea.
Not coincidentially, the crypto trading platform explained, via a blog post, that the reason behind the restrictions is because of regulations. “The increased involvement of regulators with all the major players in the industry is not only to be expected, it is to be welcomed. It is the mission of good regulators to ensure that honest citizens are not being cheated.”
The statement continued: “For this reason, we have decided to restrict access to BitMEX for users in the jurisdictions in which HDR-affiliated employees and offices are located.” The announcement comes at a time in which BitMEX is undergoing an investigation by the United States’ Commodity Futures Trading Commission (CFTC) as Bloomberg reported back in July.
No Financial Impacts
The post informed that the change “will have no financial impact on the business and will affect very few people,” while also clarifying that the BitMEX team will be reaching out to those who are affected.
“We believe success in the cryptocurrency space lies in the ability to think long-term, not short-term. And in that long-term view, we believe this course of action affords us the best opportunity to engage regulators in deep, thoughtful, and productive explorations of the risks and opportunities present in the cryptocurrency market,” the company wrote.
Reports indicate that the mentioned investigation is looking for further knowledge on American traders participation in the BitMEX exchange, a platform that is not currently registered with the Commodity Futures Trading Commission.
Circumventing the Block with Proxies and VPNs
The BitMEX exchange is basing its blocking policies on geolocation, which means that they recognize the visitor’s IP address upon visiting the site. It it is from one of the restricted nations, the platform will not grant access. The situation has caused numerous traders to install and set up circumvention tools such as proxies and VPNs in order to bypass the imposed restrictions.
Recently, the United Kingdom’s ASA (Advertising Standards Authority) maintained its decision to investigate complains about an ad published by BitMEX in a newspaper of national circulation that, according to the watchdog, failed to warn readers and potential investors about the risk of investment in Bitcoin. The ad was published in January, regarding Bitcoin’s tenth anniversary.
By Andres Chavez