Hidden Roads, a prime brokerage firm, is ceasing to provide its clients with access to the Bybit crypto platform due to a disagreement over the exchange’s KYC/AML procedures.
According to sources familiar with the situation, international prime broker Hidden Road is making preparations to halt trading for its clients on the cryptocurrency exchange Bybit. The decision is said to be a response to concerns regarding Bybit’s know-your-customer (KYC) and anti-money laundering (AML) regulations.
While the exact timing of the suspension is unclear, sources mentioned that Hidden Road had informed its clients about this development “a few weeks ago.” Bybit has not publicly commented on the issue, but a spokesperson stated to Bloomberg that the exchange is “committed to transparency and will provide further updates as the review progresses.”
In a separate incident in November 2023, Coinbase notified some of its customers about a subpoena from the U.S. Commodity Futures Trading Commission (CFTC) related to Bybit. The details of the information or documents requested by the CFTC, as well as the scope of the investigation, have not been disclosed yet.
Established in 2018 by Marc Asch, Hidden Roads offers cross-margining and margin financing for cash, cleared derivatives, and over-the-counter swaps products. The firm also provides prime brokerage services with a focus on crypto.
In 2022, Hidden Road successfully secured a $50 million Series A funding round led by Castle Island Ventures, with participation from other investors such as Citadel Securities, FTX Ventures, Uncorrelated Ventures, Greycroft, XBTO Humla Ventures, Wintermute, and Coinbase Ventures.
For more information, the Bybit crypto exchange has received a warning from AMF.