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BitMex has bled 45k Bitcoin since US gov charges, allowing other exchanges to benefit

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Over 45,000 Bitcoin has been withdrawn from BitMex since the U.S. government levied charges against the exchange and its leadership. October 1 brought two devastating blows to BitMex. First, the CFTC and DOJ brought charges against the exchange. Shortly thereafter, its founders (including CEO Arthur Hayes), were indicted by the U.S. government. The market reacted to the news with a sharp decline across many of Blockchain’s biggest assets.

BitMex Bitcoin reserves. Source: Glassnode.

This isn’t the first time in recent months that BitMex has contributed to a downward turn. The exchange first began losing the trust of its participants following a blackout on Black Thursday which prevented users from trading or retrieving their assets. While users withdrew over 100,000 Bitcoin in the six months between that episode and these recent charges, the exodus of the past two days appears to be unprecedented in scale.

Bitmex Bitcoin inflows & outflows October 1-2, 2020. Source: Crystal Blockchain.

According to data from Crystal Blockchain, in less than 48 hours, the net outflows from the exchange have exceeded 45,000 Bitcoin. Meanwhile, Gemini and Binance appear to be the biggest beneficiaries of these outflows, trailed by OKEx and Huobi. Over 20,000 BTC have been transferred out of BitMex and into the latter four exchanges.

It is unclear whether BitMex will disappear into the abyss of time like many failed exchanges before it, or if the company will survive to trade another day. Lance Morginn, the CEO of Blockchain Intelligence Group and a former supervisory special agent at the Department of Homeland Security, told Cointelegraph that the most likely outcome would be monetary penalties and a promise on the part of BitMex’s executives not to engage in unlawful activities in the future.



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El Salvador reportedly weighing paying employees in Bitcoin

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Rolando Castro, the Minister of Labor and Social Welfare in El Salvador has said that the government is discussing whether companies in the country should pay their employees in Bitcoin.

According to local radio station 107.7 Fuego GMV, Castro has discussed the issue of employers paying their workers in Bitcoin (BTC) with officials from the Ministry of Finance and the Ministry of Economy. His remarks come a week after the country’s Legislative Assembly approved the use of the cryptocurrency as legal tender.

El Salvador’s 2001 Law of Monetary Integration, which provided the legislative framework to eventually replace the Salvadoran colón with the U.S. dollar, states that salaries and fees may only be paid in colónes or dollars. However, the former is rarely used in the Central American nation now.

Related: Bill to make Bitcoin legal tender passes in El Salvador

It’s unclear if the approval of Bitcoin as legal tender in the country will expand upon existing law or replace it. President Nayib Bukele’s draft of the law shows “tax contributions can be paid in Bitcoin” and “for accounting purposes, the USD will be used as the reference currency.”

Since first announcing he would be introducing the pro-Bitcoin legislation at the Bitcoin 2021 conference in Miami earlier this month, Bukele has taken to social media to promote cryptocurrencies and mining in El Salvador. Last week, the president called on the state-run geothermal power company to make certain facilities available to Bitcoin miners.