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BitMEX Review - is it scam or safe?

BitMEX Review - Is bitmex.com scam or good cryptocurrency exchange?

RATING: 3.6 / 5 REVIEWS

RECOMMENDED BITCOIN BROKERS


Instument types

 

Instrumetnt type Leverage Maker Fee Taker Fee Settlement Fee
Swaps 1:100 -0.025% 0.075% -
Futures 1:100 -0.025% 0.075% 0.050%
Upside/Downside 1:1 0% 0% 0%

 

BitMEX (Bitcoin Mercantile Exchange) is a derivatives exchange, which offers leveraged trading on cryptocurrency-based instruments. This is not a traditional exchange, like Kraken for instance. That being said, this is not a beginner-friendly exchange – some knowledge of traditional futures and options will be required before you can fully understand the trading environment.

 

The company, security of funds

 

Company Country Regulation
HDR Global Trading Limited Seychelles N/A

 

The company behind BitMEX is called HDR Global Trading Limited. It is registered on the Seychelles, which generally does not inspire a lot of trust. That being said, little to no regulation is applied to the crypto-space in most jurisdictions. Most exchanges earn their credibility by word of mouth, slowly. 

 

That being said, trading at BitMEX offers several key specifics. Most importantly, your account balance and trading results (PnL) are always measured in Bitcoin. While this goes in-line with the company’s main philosophy, it may prove to be an inconvenience for those looking to make systematic trading profits. The regular traders probably also hedge their exposure.

 

From its foundation in 2014 until now, BitMEX has not experienced any major hack. This is always a positive sign, although not a guarantee for future stability.

 

The user reviews on BitMEX are not that many, given the fact this is a relatively complicated exchange. However, there are virtually no complaints about the company’s service.

 

 

Trading conditions

 

Trading instruments

As mentioned previously, this exchange offers very interesting trading instruments. They include:

 

Perpetual swaps function similarly to a futures contracts, except for the fact they don’t expire. You may think of this as an ETF or CFD, although this will be a very loose interpretation.

 

Currently only XBTUSD is available as a perpetual swap. The BitMEX price index is taken as an average from the trading prices at Bitstamp and GDAX.

 

Futures work the same way the traditional ones, which are traded at futures exchanges do. They have an expiration date, a different Initial and Maintainence margin and a specific settlement mechanism. The coins for witch futures are available are XBTUSD, ADA, BCH, ETH, LTC and XRP. The asset list used to be a lot longer and even included an XTBJPY pair.

 

Upside/Downside Contracts are derivatives similar to exchange-traded options (which are very different form their binary counterparts). Trading in these assets involves an initial premium payment and a fixed strike price. Taking short positions isn’t allowed. At the time of writing this is only available for the XBTUSD pair and the available strike prices are rather far apart from each other. 

 

At the time of writing, there is a $2000 discrepancy between the two strike prices

 

Binary series (or predictions) are another type of instrument, which is apparently discontinued. We have kept our portion of the review, which describes them and it can be found later on. The following conditions only apply, for futures and perpetual swaps.

  

Leverage

A maximum leverage of 1:100 is available. That being said, this comes at a price, which is charged once every 8 hours. Be sure to check out the BitMEX funding page to fully understand the implications which this will have on your account.

 

>>Regulated Bitcoin forex brokers, where leverage is free<

 

That being said, a neat feature at BitMEX is the fact you can change your leverage, per position. In effect, this allows you to place a maximum loss, after which your single position will be liquidated. With forex brokers, your entire account serves as a guarantee for all of your positions. 

 

Fees

The fees on Perpetual Swaps (and some of the futures)  are currently -0.025% for the market makers and 0.075% for the market takers. These terms refer to the different traders in relation to liquidity – those who place “passive” orders in the book will receive small rebates, while those trading at the market will have to pay a fee. Additionally, there is a 0.05% settlement fee for futures. All of these levels are very competitive, when compared to most crypto-exchanges.  

 

Forex brokers, on the other hand, charge the costs of trading in their spreads. While there are a lot of factors, which make comparing the two services hard, we have done so here

 

 

Binary Series (predictions) 

 

Update: This idea appears to be removed since our initial review. The B-series are prediction-based contracts, which can only settle at either 0 or 100. This instrument is by far the most unusual and we will not recommend it to beginners. In essence, the B-series are a more complicated way of making a bet on a given blockchain event. As an example there used to be an instrument, associated with the activation of SegWit on the Bitcoin chain, when the fork occurred. 

 

The only b-series betting instrument available at the time of writing of this review is related to the next 1mb block on the Bitcoin blockchain. 

 

B-series are traded with no leverage, a 0% maker fee, a 0.25% taker fee and 0.25% settlement fee. 

 

 

Trading platform

 

BitMEX allows trading through a web-based platform. The charting functionality is provided by TradingView, which means the technical analysis aficionados will be pleased. Here is an overview of the platform (click to zoom-in):

 

 

The top portion allows switching between the different products, while the order placement module is located where the welcome message is in this screenshot. 

 

This is yet another crypto-exchange which provides a vertically arranged order book. While this isn’t a huge issue, people who are familiar with the way traditional trading platforms, like cTrader present the depth of the market will be surprised. Other than that, the platform has a nice visual appeal. 

 

Additionally BitMEX has been integrated with two of the leading futures trading platforms, Ninja Trader and Sierra. Keep in mind these may not be that friendly towards beginners and using them usually comes with a monthly fee.

 

Methods of payment

 

Only Bitcoin transfers are allowed at BitMEX. If you are used dealing with companies, who support credit cards, or e-wallets (such as Neteller) this exchange may not be right for you anyway, as the trading specifics require detailed knowledge of the crypto-space.

 

Conclusion

 

BitMEX is a company which provides access to derivatives based on cryptocurrencies. Despite being based on the Seychelles, they have proven their worth since 2014. Trading at this exchange is very complicated and we will not recommend it to beginners. Even those of you with experience in either the crypto-world or traditional financial markets should look up some tutorials, before trading with serious sums. That being said, those seeking arbitrage trades may find exciting opportunities at BitMEX. 

 

Here are the pros and cons of this exchange:

 

Pros Cons
No major hacks yet Complicated trading environment
Competitive fees Account is in Bitcoin
Mixed user feedback Margin comes at a price
Relatively nice trading platform  

 

Latest news about BitMEX
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Forex
Broker Country Regulation Min deposit Max payout Review
Seychelles FinaCom $10 86% Review Website
Australia ASIC $50 88% Review Website
Cyprus CySec $200 89% Review

Traders` reviews for BitMEX

Spread

Pros

Cons

 

 

Slippage

Pros

Cons

 

 

Requotes

Pros

Cons

 

 

Price feed

Pros

Cons

 

 

Platform

Pros

Cons

 

 

Deposit/Withdraw

Pros

Cons

 

 

Customer service

Pros

Cons

 

 

Summary

Pros

Cons

 

 

BitMEX is a scam

After several attempt to make some leveraged trading on this platform i concluded that there is something shady, price misteriously swings up and down, despite there is not much volume when you are close to liquidation value you can bet the volume will come always taking price briefly down and collect your trade.
Fees applied on multiple day leveraged trade is just a rip off.

This business rely on many paid articles and reviews saying how great and transparent this platform is, it is not.

Robert 05/22/2018

Orders cannot be submitted when quick price action

When the market moves quickly against you, it is impossible to send an order and have it executed....

So your account blows off very quickly.

When you send your order for execution, message you will receive is :

"Order submission error - Order could not be submitted. The system is currently overloaded. Please try again later"

I let you imagine the consequences on your account... : you lose all your funds...

Pat 03/09/2018

BitMEX scam

Bitmex blocks withdrawal. Support does not explain why for several days. Before it I was asking politely support some inconvinient questions about priveledge of their own marketmaker during ‘system overloading’. I’m afraid I’ve found scam and bitmex chiefs blocked me. My questions about reason of blocking is ignored

Alf 03/01/2018

Scam!

I was trading XBTUSD… I had liquidation price set o 11321.5. They closed my position even if price didn’t drop below 11350… and I lost all my asset. This is some kind of joke – I lost like 2000 USD and I doubt that they will respond on my complaint.
Looks like this is well organized fraud. I have no idea where I can report this. I have screenshots of order history, current account status, everything – I was looking very closely what’s going on as I knew this was risky trade… but didn’t risk – they just stole my money.

Michal 01/28/2018

Bitmex is a scam: I have reported them to Australian consumer commission

Bitmex is a scam.

Currently on a trade with profit of $300 with10* leverage

Unrealized 30% Profit 0.14 btc
Relaized funding rate fee of 0.14 btc which goes up every 6hrs , meaning I'm paying $775 USD in fees on leveraged trade where I'm profitable, taking all my profit. And it's hard to be on a positive trade so you get extremely screwed by bitmex if you are in a losing trade or positive trade. Wasn't a good sign when they advertise incorporated in schellyes.

I have reported them to Australian consumer commission for hiding excessive hidden fees

James 10/15/2017
Forex
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