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This isn’t true. The Bitmex “perpetual swap” isn’t any different from what spread betting and CFD dealers have been doing for years. They are basically just ver

This isn’t true. The Bitmex “perpetual swap” isn’t any different from what spread betting and CFD dealers have been doing for years. They are basically just very short term futures that automatically roll forward. The real genius was to invert the trading process. People often talk about Bitmex being a Bitcoin derivatives platform, but it isn’t. It’s a USD derivatives platform. When you trade on Bitmex you’re trading USD derivatives funded in Bitcoin. This is what in theory allowed them to sidestep all that pesky KYC.

hntrader 6y ago
Isn't it rather different to CFDs because of the interest mechanism that it uses to keep the price aligned with spot? Where else have we seen that before Bitmex? The inversion was another big innovation of the perp contract, yes.
- qeternity 6y ago
  No, spread bettors have constant (daily) financing adjustments. We’ve seen this loads before, it isn’t novel.
  - tim333 6y ago
    From my experience of trading on both it is rather different. With spread betting you are basically just making a bet with the exchange at a price they quote. With the bitmex product you are trading with other traders rather than with the exchange. They claim to have invented it: "A Perpetual Swap is an innovative product invented by BitMEX"
smabie 6y ago
yeah except retail for the life of them can't figure out how to price quantos and the exchange is dying. They had such a headstart and squandered it. ftx is now positioning itself as the leading exchange.
- jkhdigital 6y ago
  The dynamic hedging required for quantos is annoying. You’re pretty much required to run a trading bot to keep your position delta where you want it.
  - smabie 6y ago
    Hah, yeah, quantos are constantly giving us trouble on bitmex. Getting the volatility right is a bitch. You a professional crypto trader? Hit me up if so, always looking to connect/network/etc.
jkhdigital 6y ago
This is true. I wonder, did “inverse” derivatives exist in any real markets before BitMEX? That is, contracts denominated in the quote currency.

hntrader 6y ago

Isn't it rather different to CFDs because of the interest mechanism that it uses to keep the price aligned with spot? Where else have we seen that before Bitmex? The inversion was another big innovation of the perp contract, yes.

qeternity 6y ago
No, spread bettors have constant (daily) financing adjustments. We’ve seen this loads before, it isn’t novel.
- tim333 6y ago
  From my experience of trading on both it is rather different. With spread betting you are basically just making a bet with the exchange at a price they quote. With the bitmex product you are trading with other traders rather than with the exchange. They claim to have invented it: "A Perpetual Swap is an innovative product invented by BitMEX"

smabie 6y ago

yeah except retail for the life of them can't figure out how to price quantos and the exchange is dying. They had such a headstart and squandered it. ftx is now positioning itself as the leading exchange.

jkhdigital 6y ago
The dynamic hedging required for quantos is annoying. You’re pretty much required to run a trading bot to keep your position delta where you want it.
- smabie 6y ago
  Hah, yeah, quantos are constantly giving us trouble on bitmex. Getting the volatility right is a bitch. You a professional crypto trader? Hit me up if so, always looking to connect/network/etc.

jkhdigital 6y ago

This is true. I wonder, did “inverse” derivatives exist in any real markets before BitMEX? That is, contracts denominated in the quote currency.