A Chinese court has ruled that BKEX, a crypto exchange known for futures trading, operated as an illegal gambling platform.
According to local reports, the People’s Court of Pingjiang, Hunan Province, recently ruled BKEX’s contract trading as outright gambling. The ruling followed an extensive court proceeding about the exchange’s operations, its founder, Ji Jiaming, who remains at large, and several employees.
The court determined that BKEX facilitated high-leverage perpetual contract trading, which it equated to betting on cryptocurrency price movements, a violation of China’s strict anti-gambling laws.
BKEX was established in 2018 and allegedly operated under various names between 2019 and 2022 before dissolving. As of 2021, it had offered perpetual contracts that allow users to speculate on Bitcoin and Ethereum prices with leverage as high as 1,000x. The exchange reportedly had over 270,000 users for the trading feature and generated nearly $55 million in profits.
Employees, including Zheng Lei and Wang, both of whom were key figures in the exchange’s management, were convicted as accomplices. While most received suspended sentences, the court imposed fines and asset seizures as penalties. Zhang received a 25-month suspended sentence and a fine of approximately $30,000, while Wang, responsible for KYC compliance, was given a 23-month suspended sentence with a $10,000 fine.
China has long scrutinized cryptocurrency trading over concerns related to financial stability, fraud, and capital outflows. The State Administration of Foreign Exchange recently introduced new regulations requiring banks to identify and report high-risk transactions, especially those linked to cryptocurrencies.
At the time, Liu Zhengyao, a Shanghai-based attorney, reportedly commented that the new regulations offer a more solid legal foundation for penalizing crypto-related activities. He argued that these rules indicate the country’s ongoing strict stance on cryptocurrencies would not change in the near future.
If you want to read more news articles like this, visit DeFi Planet and follow us on Twitter, LinkedIn, Facebook, Instagram, and CoinMarketCap Community.
“Take control of your crypto portfolio with MARKETS PRO, DeFi Planet’s suite of analytics tools.”
