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Today, BitMEX turns 11 years old. In a market led with volatility and uncertainty, most would say this is a remarkable milestone.
But this achievement isn’t one that can be credited to us. BitMEX has been home to the best traders since 2014 – the OGs that grew up with the crypto industry. Cycles come and go, but the constant factor is clear: our traders and their skill.
Today, we celebrate BitMEX Legends. The traders who have made it through all the vicious cycles. The traders who have mastered the craft today.
As we quietly delve into another year of BAU, here are 11 insights that we hope to share from 11 years of experience in crypto markets – curated from our traders’ knowledge as well as our own.
Let’s dive in.
If you haven’t signed up for a BitMEX account yet, we’re currently offering $5,000+ worth of rewards to new users - you can register here.
#1: It’s always been about Bitcoin.
Figure 1: Bitcoin Price History (XBTUSD from 2014 to present)
This isn't a "maximalist" position; it's an observation of capital. In the last 11 years, only one crypto asset has demonstrated a predictable, reflexive response to its own programmed monetary policy (the halving) and consistently broken its prior cycle's all-time high.
Why? Because its provenance is immaculate. There was no pre-mine, no ICO, no foundation, and no venture capital allocation. This fair launch, combined with over a decade of history and the battle-tested security of Proof-of-Work, provides a foundation for its decentralisation that no other asset can claim. It has no CEO, its monetary policy is ossified, and its core rules cannot be changed by a small committee of developers. True decentralisation.
#2: Perpetual swaps are the greatest finance invention in the 21st century.
Before we launched the XBTUSD perp, "crypto derivatives" were a joke. You had clunky, expiring quarterly futures on illiquid exchanges. You couldn't trade; you could only punt in a direction and then pray that the "basis"—the spread between the future and the spot price—didn't liquidate you first. It was a broken model, a relic of traditional finance for an asset that never sleeps.
We pioneered the Perpetual Swap to solve this problem, creating an instrument that lets traders speculate on Bitcoin's price without an expiry date. But the real genius, the engine we designed to make this possible, is the funding rate mechanism.
This mechanism is the dynamic balancing tool that ties the derivative's price to the underlying spot index. It's an incentive system that continuously pays traders on one side of the book to keep the market in line, without ever needing to settle. This combination—no expiry and a self-governing peg—created a superior, capital-efficient tool for speculation and hedging. It provided product-market fit, so it ate the world. Today, the perp is the market. The spot market just follows our lead.
Figure 2: BTC Perpetual Swap vs. BTC Spot Volumes from 2017 - 2025
#3: Security isn’t a product — it’s a practice. You can’t buy trust. You have to earn it every day.
We've watched the graveyards of crypto projects fill up:
Mt. Gox (2014): The Insolvency. Showed that your "balance" is just a number on a database – until it's not.
Quadriga (2019): The Founder Risk. Showed that the tail risk is real and your funds can be locked in a dead man's cold wallet (not to mention it still remains a mystery whether he’s faked his death).
Celsius/BlockFi (2022): The Rehypothecation. Showed that "yield" was customer funds being gambled and that customers were unsecured creditors.
FTX (2022): The Commingling. Showed that the line between "exchange" and "market maker" was a fiction. This is a key feature of so-called “B-book” exchanges—a practice we believe is alarmingly widespread. We argue that this model persists today for many crypto exchanges.
Figure 3: Bitcoin Price History relative to the timeline of major crypto incidents
When we first started, BitMEX was built on a system of 100% cold storage, multi-signature wallets. It required manual, human-audited intervention for every withdrawal. It was slow. It was expensive. It made us miss the "instant deposit/withdrawal" marketing hype.
And that is the exact reason we've never lost a single Satoshi to a hack. Security is not a feature; it's a series of non-negotiable trade-offs, slowly but surely built over a long period of time. Now we have that same foundation of security, with improved technology to support real-time withdrawals.
#4: Are you trading the market or the house?
Figure 4: Overview of how the FTX collapse came to be in relation to Alameda Research and FTX exchange
A commonly overlooked question for crypto traders: Who – or what – is on the other side of their position? Many platforms in this space operate with internal market makers. This structure creates an inherent conflict of interest and poses additional risks for the exchange. When the exchange is also a participant, it introduces profound information asymmetry. An internal desk may have privileged access to order flow data and liquidation levels that are unavailable to other traders.
This model, where the crypto exchange is also the market maker, puts customers at a distinct disadvantage and creates systemic risk (demonstrated by the FTX/Alameda collapse). The issue still persists – in 2023, the Financial Times reported that Crypto.com was operating internal proprietary trading desks, with employees allegedly told to keep the operation secret—a clear example of the conflict between an exchange and its customers. We built BitMEX on a different premise from day one. We are a neutral venue, not a proprietary participant. We only work with designated market makers who are not linked to BitMEX.
Our business model is aligned with the customer’s needs – to provide a fair and neutral marketplace. Make sure to DYOR and vet where you trade.
#5: Crypto remains a fragmented market.
The crypto "market" isn't one big ocean; it's a collection of a thousand siloed puddles. Take the $MMT (Momentum) case, where the token price between different exchanges diverged by over 50%. "Hedged" arbitrageurs were vapourised because they learned the hard way that the plumbing between these siloed markets is the first thing that breaks under stress.
Figure 5: BitMEX consistently delivers higher average and median gains, demonstrating a more effective listing strategy
This fragmentation also exists in exchanges' listing strategies. As we highlighted in our Q1 2025 Derivatives Report, we found that on some exchanges, over 70% of new perp listings reached their all-time high on Day 1—a classic "pump and dump" structure. In contrast, BitMEX listings showed sustained momentum, with an average gain of 62.55% after the first day of listing.
#6: The real risk isn't liquidation. It's Auto-Deleveraging.
Getting liquidated on a position means you were wrong. It's clean. It's simple.
Auto-Deleveraging (ADL), however, is the market's boogeyman. It means you can be 100% right and profitable, yet still have your position forcibly closed against your will.
ADL is what happens when the market moves so fast that a position is liquidated past its bankruptcy price, and the Insurance Fund is not able to cover the loss. To keep the exchange solvent, the system must find an opposite, profitable trader and deleverage them. You are "chosen" by a ranking system (based on leverage and PnL). Depending on the platform you are trading on, and its ADL system design, you can fall victim to ADL. Perfecting our ADL system and risk engine is where BitMEX has spent most of its engineering efforts from day one. Also, unlike some exchanges, we don't give certain traders "priority positions" in the ADL queue; everybody operates under the same fair principles. Which is one of the factors that have allowed us to stand as one of the longest-standing crypto exchanges with zero hacks to date.
#7: Fair Price Marking: The shield for perp traders against market manipulation.
Figure 6: BitMEX's Fair Price Marking (red line) protects traders from unfair liquidation by ignoring outlier flash crashes from a single source.
Every trader fears their liquidation price. We've all seen erroneous price drops (also known as a "scam wick")—a single, violent, 15 second candle that flashes down 20%, 30%, or more, caused by either fat-finger error, a low-liquidity cascade, or a coordinated unfair attack by market makers. It hunts your stops, liquidates your position, and snaps back as if it never happened. You may have been right, but you can still get rekt.
This is why BitMEX pioneered the concept of Fair Price Marking. Your liquidation on BitMEX is not triggered by a volatile Last Price. It's triggered by the Mark Price. This is our most critical, rigorous trader protection. Our Mark Price isn't based on our own order book. It’s based on a Hybrid Composite Index (like the .BXBT, which is volume-weighted and derived from a basket of major, external, high-liquidity spot exchanges like Coinbase, Kraken, and Bitstamp).
To liquidate a trader, a market manipulator cannot just dump on BitMEX’s contract. They would have to find the capital to crash the entire global spot market across all those exchanges simultaneously. This system is your shield. It's designed to ignore the "scam wicks" and protect you from localised manipulation.
The Last Price is just a suggestion; the Mark Price is the law. Your first job as a trader isn't to set your Stop Loss; it's to investigate exactly how your exchange calculates its Mark Price. That is your real defense.
#8: Leverage is freedom.
BitMEX was the first to offer up to 100x leverage, a concept often viewed as 'reckless' by traditional finance (TradFi). However, it was embraced as ‘freedom’ for the everyday trader. The most critical, yet overlooked aspect behind our 100x leverage crypto derivatives is the built-in protection: NON-RECOURSE leverage.
Unlike TradFi markets (like forex or CFDs) where you can lose more than your initial deposit, crypto trading on BitMEX ensures your maximum loss is strictly limited to the collateral (margin) you posted. This non-recourse feature is a vital protection for retail investors, creating a definite financial floor for risk. When a position is liquidated past its liquidation price, the system (BitMEX) absorbs the loss; the trader is never liable for negative balances.
This tool instantly granted small retail traders the power to control large trade sizes—turning $1,000 of collateral into a $100,000 position. It democratised market access, giving the individual the purchasing power once only belonging to whale traders.
This freedom, however, requires extreme caution. 100x leverage is a significant commitment. While it can amplify your conviction, it also significantly amplifies your errors, requiring meticulous risk management to avoid liquidations. At 100x, a 0.5% move against you will result in a liquidation. It's a tool that demands a level of precision and risk management that most traders simply do not possess. It will not make a bad trader good, but it will make a good trader faster. In the end, it's the ultimate expression of what this entire revolution is supposed to be about: unadulterated market access and total personal responsibility.
#9: The Bitcoin 4-Year Cycle isn’t dead.
Figure 7: An analysis of Bitcoin’s cycles from 2018 - 2025
Every cycle, a new narrative is born to convince you "this time is different." In 2017, it was the Initial Coin Offerings (ICOs). In 2021, it was the "Supercycle," where DeFi and NFTs would supposedly mature the market beyond 80% drawdowns. Today, spot ETFs are the new saviour.
As outlined in our recent article, "Four-Year Cycles Aren't Dead," this optimism is a feature, not a bug. The cycle isn't just a clock tied to the halving; it's a structural purge. It's a reflexive system built on leverage, new token issuance, and human greed.
The system is designed to over-leverage, build a tower of euphoria, and then collapse on itself. Don't be fooled by the "institutional" wrapper. As we saw with the $19bn liquidation cascade on 11 October, crypto-native fractures still happen, proving the internal plumbing is unchanged. The cycle isn't broken; it's just reloading.
#10: Be careful of the high-yield stablecoin trap.
In the last 11 years, we have continuously watched the market learn one lesson repeatedly: "stablecoins" are sometimes just a marketing term. This is not to discount the fact that stablecoins are one of the most important financial innovations globally. It's the 24/7, borderless, programmable dollar—a new financial rail that will, in time, eat the traditional banking system. This is the revolution.
But this revolution has a dark shadow. The "stablecoin" label has been used to camouflage high-risk, experimental time bombs. The pattern is always the same: new projects appear, promising the "stability" of a dollar coupled with impossibly high, "low-risk" yield. This high yield is often a lure – and should be considered a red flag.
Figure 8: A logarithmic scale of LUNA’s price in USD
Take the Terra/LUNA collapse as an example. The "stablecoin" (UST) in this scenario was just a wrapper for the real product: the Anchor Protocol's 20% APY, which was an artificial subsidised yield at the cost of making the LUNA/UST stablecoin into a more fragile, reflexive musical chairs game. When the music stopped and concern about UST started to rise, the entire structure crumbled. We’ve seen “high yield stablecoins” collapse repeatedly with the depegs of Stream Finance's xUSD and Stable Lab’s USDX —complex, leveraged "yield-bearing" schemes that were, in reality, poorly managed hedge funds masquerading as stablecoins.
Bear in mind – this will happen again. New innovations will sometimes promise the impossible. The lesson from our 11 years of experience: always DYOR and maintain skepticism until you have enough information. You must always ask: "What is the real mechanism driving the project?" and, more importantly, "Where is the yield actually coming from?"
#11: Don't confuse the wrapper with the asset.
For over a decade, the market anticipated institutional adoption. Now it has arrived, packaged in familiar wrappers like ETFs and Digital Asset Treasuries (DATs). While these products offer new access, it's crucial to understand their structure. We see a common business model emerging, particularly with DATs: a treasury raises capital, its shares often trade at a significant premium to the Net Asset Value (mNAV) of the crypto it holds, and corporate managers can then issue new shares "At-The-Market" (ATM) to capture this premium.
Figure 9: Crypto Treasury Companies Overview, dated 14 Nov 2025 (source: Blockworks Research)
This isn't inherently bad, but it creates different incentives. As we explored in our BitMEX Alpha post, "DAT Stocks vs. Crypto," this model introduces a structural headwind. The constant ATM issuance can put downward pressure on the mNAV premium, which may help explain why these stocks can underperform the very crypto they are supposed to track. Since our post, the market has seen this premium entirely vanish, with several major DATs now trading at a mNAV below 1.
These wrappers are not the asset; they are a separate business, complete with management fees and principal-agent considerations. For a long-term, pure-play perspective, we believe the focus should remain on the underlying crypto assets themselves.
The Bottom Line
The industry has cycled through a spectrum of altseasons, black swan events, pico-tops, hacks, and fresh innovations, but one factor will remain the same – the skill and resilience of our traders – our BitMEX Legends. If you are still here after every market fiasco, you're not just a survivor; you are battle-scarred, stress-tested, and possess the grit demanded by this market.
We salute that resilience - BitMEX would not be what it is today without our traders. As a token of respect and to celebrate the journey, we are launching the 'BitMEX Legends Showdown' – a major trading competition with a 5 BTC Prize Pool.
This is the first of many initiatives designed to reward our community for their unwavering support over the past 11 years. Stay tuned to our X and Telegram for the latest announcements.
To be the first to know about our new listings, product launches, giveaways and more, we invite you to join one of our online communities and connect with other traders. For the absolute latest, you can also follow us on Twitter, or read our blog and site announcements.
In the meantime, if you have any questions please contact Support who are available 24/7.
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