Derivatives are gradually becoming an important component of the cryptocurrency trading market. Derivative assets refer to financial instruments that track the price of an underlying asset to derive their value. Cryptocurrency derivatives are assets, which are not inherently or functionally cryptocurrency, but which are derived from crypto assets to deliver an exponentially simulated performance of the cryptocurrency market.
Interestingly, the growing popularity of crypto derivatives is not surprising; after all, the size of Wall street’s derivatives market is reportedly about 10 times bigger than the size of the actual underlying assets. People who use cryptocurrency derivatives typically trade in futures, options, swaps and other derivative instruments offered on crypto derivatives trading platforms.
Currently, the two most popular platforms that are focused exclusively on crypto derivatives are BitMEX and Bybit. Any trader worthy of the name will certainly be interested in knowing the best trading platform for high-leverage crypto. This piece compares BitMEX and Bybit with a view to helping you identify the best place to trade crypto derivatives.
Overview
| BitMEX | Bybit | |
| Beginner Friendly? | ❌ | ✅ |
| Mobile App (iOS & Android)? | ✅ | ✅(App coming soon) |
| Buy/Deposit Method: | Cryptocurrencies (BTC Only) | Cryptocurrencies |
| Sell/Withdrawal Method: | Cryptocurrencies (BTC Only) | Cryptocurrencies |
| Minimum Deposit | 0.001BTC | No Minimum |
| Available Cryptocurrencies: | BTC, ETH, EOS, XRP, ADA, LTC | BTC, ETH, EOS, XRP |
| Offers Fiat Pairings? | ❌ | ❌ |
| Offered Leverage | 5X | Up to 100X |
| Trading Fees: | -0.0200% (Maker fees)
0.0750% (Taker fees) |
-0.0250% (Maker fees)
0.0750% (Taker fees) |
| Withdrawal Fees: | No withdrawal fees | No withdrawal fees |
| Licensed or Regulated? | ✅ | ✅ |
| Social Trading? | ❌ | ❌ |
BitMEX vs Bybit: Opening Your Account
Opening an account with BitMEX is simple; you’ll be required to provide your email, choose a password, enter your country of residence, first name, and last name. A verification link will be sent into your email. Once verified, you can fund your account to start trading.
Opening an account on Bybit takes less than 30 seconds and you can choose to create an account either with your email or phone number. After you’ve entered your email/phone number and chosen a password, a verification link will be sent to your email or phone. You can fund your account to begin trading immediately after you verify your email or phone number.
BitMEX vs ByBit: Contract Options
The most popular cryptocurrency derivatives in the market right now are futures, and options. Neither Bybit nor BitMEX currently offers crypto options.
BitMEX currently allows traders to place future contracts and perpetual contracts. Bybit users can only place perpetual contracts but the exchange is working on developing multiple new products.
BitMEX vs ByBit: TestNet
BitMEX has a TestNet that serves as a sandbox to play around with trading cryptocurrency derivatives without risking actual funds. BitMEX Testnet provides traders with live trading data and a real-time simulation of the wider cryptocurrency market.
Bybit also provides a Testnet on which you can practice derivatives trading without risking your funds. The simulation on Bybit Testnet is immersive such that you’ll need to open a Testnet account and fund the account with “Testnet BTC” before you can start placing trades.
If you’d rather start trading crypto derivatives with real money, Bybit offers new users a $60 welcome bonus, which is real money that you can apply towards trading until you are comfortable enough to put your funds in the market.
BitMEX vs ByBit: User Interface
BitMEX doesn’t appear to have put much thought into the user experience side of its trading platform. A trader can do basic things such as buying and selling contracts, choosing how much leverage they want, and reviewing market charts. However, the crowded feel of the platform suggests that you may not necessarily enjoy the overall trading experience.
Bybit appears to have a friendlier user interface made up of compartmentalized panes that display information about different trading actions. The UI also has subtle hints and prompts that help traders understand the different features while navigating their ways around the trading platform.
Controversies
Cryptocurrency trading still attracts skepticism and controversies because it fundamentally promotes money that is not backed by a sovereign entity.
In the last couple of years, Bitcoin has been at the center of different kinds of controversies. For instance, there are reports that BitMEX experiences system overloads during peak trading times when traders buy and sell contracts rapidly. The overload often makes it impossible to enter or close trades; thereby messing up trading strategy for traders.
There are also unverified controversies that BitMEX allows Insider Stop Hunts and that it could maliciously close to liquidate your positions arbitrarily.
Final Verdict
BitMEX and Bybit are both remarkable cryptocurrency derivatives trading platforms. In the preceding sections, we’ve highlighted their various strengths and weaknesses so that you can make an informed decision about where to conduct your trading activities.
If we must pick either of the two platforms, Bybit will be our most preferred choice because of its fun and engaging user interface. We also like the fact that Bybit has a straightforward fee structure, unlike BitMEX’ fee structure that varies with different cryptocurrencies.
However, BitMEX has more cryptocurrencies listed than Bybit – this is an important point to consider if you plan to trade across multiple cryptocurrencies simultaneously. Nonetheless, the unaddressed controversies surrounding BitMEX doesn’t provide much comfort; hence, our final verdict is to declare Bybit as the clear winner.