BKEX staff members in China convicted over illegal crypto gambling

Staff members of the BKEX exchange in China have been sentenced after they were found to have engaged in illegal crypto gambling. The contract trading platform was found by a court in the Asian nation to have operated as an illegal gambling operation.

A hearing at the end of January that took place in Pingjiang County, Hunan Province, ruled that the contract transactions that took place should be counted as online gambling.

BKEX was founded in 2018 by an entrepreneur named Ji Jiaming, who set up the business via a company called Chengdu Dechen BiKe TianXia Technology. The name of the business was then changed on a regular basis to avoid detection by the authorities, it has been claimed. The BKEX founder has avoided arrest and is reportedly on the run with his whereabouts unknown.

The probe found that BKEX had enabled betting with USDt, which is a stablecoin that has earned backing by the US dollar. It was revealed to have provided leverage as high as 1,000x, with users given the chance to trade on the price movements of crypto assets such as Bitcoin and Ether. While futures trading is common around the world, China has decided it is gambling.

Multiple employees and agents have been sent to prison as a result of their involvement in the cryptocurrency gambling operation at BKEX, which was based in the British Virgin Islands. As BKEX was accessible to users in the country, the Chinese court said it fell under its jurisdiction.

Eight people in total were charged over the issue including Zheng Lei, who was sentenced to more than two years of jail time. The wallet engineer and department head was accused of providing technical support for the BKEX illegal crypto gambling and was fined 150,000 yuan ($20,900). Chinese authorities also confiscated 1.34 million yuan ($186,600) of his earnings.

BKEX’s contract trading was extremely busy at the height of the platform’s popularity. It reportedly had more than 270,000 users in total with some 60,000 of these classed as active traders. BKEX generated in excess of 54.7 million USDT in profit before authorities stepped in.

While some Asian nations have opened the door to cryptocurrencies, with Thailand taking a more positive approach in recent times, others such as China and Singapore remain sceptical. Thailand is planning to open the door to crypto, as well as building several casino resorts.