October 9, 2020 | AtoZ Markets – BitMEX ex-CTO Samuel Reed, who was charged and arrested by the U.S. Department of Justice on October 1, has been released on a $5 million appearance bond. The $5 million bond is unsecured, with $500,000 in cash.
BitMEX's Samuel Reed released until court appearance
According to a court document seen by AtoZ Markets, Reed's bond was approved on October 3, on conditions that he would appear for court proceedings and if convicted, would surrender to serve a sentence. Reed and his wife's passports have also been reportedly seized.
Reed, 31 was arrested in Massachusetts for allegedly violating the Banking Secrecy Act (BSA) and “willfully failing to establish, implement, and maintain an adequate anti-money laundering (‘AML’)” at BitMEX.
As AtoZ Markets previously reported, Samuel Reed, along with Arthur Hayes, CEO of BitMEX, and two other BitMEX founders have officially stepped down from their positions due to the accusations levied by the CFTC and the DoJ.
Related: CFTC Charges BitMEX Owners with Money Laundering Violations
The allegations against the founders are offenses punishable with a maximum sentence of five years in prison for each charge.
While Reed was arrested promptly, the other three executives in question presently remain at large. It has been reported that Reed’s bond was approved on October 3, on conditions that he would be present for court proceedings and if convicted, and would surrender to serve a sentence as per the ruling.
Bitmex is already feeling the effects of these developments
BitMEX has continued "business as usual," but bitcoin withdrawals, open interest for its futures, and volumes indicate otherwise. Over 40,000 bitcoin, currently worth about $435 million, has been withdrawn from BitMEX, according to various data trackers.
Open interest in BitMEX's bitcoin futures market has declined from more than $1 billion to under $600 million. Volumes have also dropped.
Some in the crypto community have criticized BitMEX for soiling the industry's reputation as a whole and potentially hardening regulators' stance towards the sector.
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