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BitMEX exchange operator shuffles leadership in wake of criminal charges

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The operator of crypto derivatives exchange BitMEX has announced a sweep of its top leadership, after United States authorities charged its founders with failing to prevent money laundering and operating an unregistered trading platform illegally. 

On Oct. 8, BitMEX’s operator, 100x Group, announced that the exchange’s three co-founders, all of whom were charged in the case, will no longer hold executive roles at 100x: Arthur Hayes, Samuel Reed and Ben Delo. Greg Dwyer, the fourth executive to be charged, will take a leave of absence from his role as head of business development.

To replace Hayes, 100x Group has announced a new interim CEO , Vivien Khoo. Khoo was until now 100x Group’s chief operating operator. She first joined the company in 2019, after serving as managing director, Asia-Pacific  compliance, at Goldman Sachs, and has a background at the Hong Kong Securities and Futures Commission.

100x Group commercial director Ben Raddclyffe will take on expanded responsibilities for client relationship handling and oversight of financial products. Radclyffe has 20 years’ experience in finance and trading at Deutsche Bank, UBS and Tower Research Capital.

In an official comment, 100x Group chair David Wong has said the leadership “are well-placed to continue the growth and development of the 100x Group, including completion of the BitMEX User Verification Programme,” adding: 

“It is business as usual for us and we thank all clients for their continued support.”

For more insight into the significant challenges that BitMEX’s “business as usual” could face, and its intersection with wider regulatory developments in crypto, you can catch up on Cointelegraph’s coverage of the case as it unfolded earlier this week. 



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Regulation

New York authorizes first Yen stablecoin operator in the US

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New York has given the first authorization to a stablecoin backed by the Japanese Yen to operate in the U.S.

Per a Dec. 29 announcement, the New York Department of Financial Services has granted Japanese firm GMO-Z.com a charter to handle U.S.D. and Yen-backed stablecoins in New York. 

Given New York’s status as a global center, the NYDFS is the most prominent state financial regulator in the U.S. It is also one of the most aggressive. A pass to operate in New York often opens up the rest of the country. 

GMO’s charter is as a limited liability trust company rather than a full bank, the principle difference being in authorization to handle deposits. While a stablecoin operator typically needs the ability to hold reserves of the pegged asset, GMO’s charter limits its rights to hold other kinds of deposits not central to its ability “to issue, administer, and redeem” its stablecoins. 

The right to issue such non-depository charters has been a bone of contention between state regulators like the NYDFS and national banking regulators in the U.S. 

GMO president and CEO Ken Nakamura said: “We’re breaking ground with our move to issue the first regulated JPY-pegged stablecoin, which many see as a safe haven asset.” 

The NYDFS recently made changes to its famous BitLicense, including a conditional format that buddies up newly licensed firms with existing licensees. The first conditional BitLicense went to PayPal, facilitating the launch of its new crypto services earlier this fall with the help of longstanding licensee Paxos.