Arthur Hayes BitMEX Crypto Derivatives Exchange Is Over $800 Billion Worth Of Trades


Arthur Hayes BitMEX Crypto Derivatives Exchange Is Over $800 Billion Worth Of Trades

Arthur Hayes is BitMEX founder and CEO, but how was he able to come up with the idea of one of the most important virtual currency exchanges in the market?

He started working as a graduate trainee at Deutsche Bank in 2008. Logically, the market was experiencing some turbulence during that year, but the overall sentiment was bullish for the future. With the crisis triggered by the fall of Lehman Brothers, the financial industry was damaged creating job losses and bonus cuts all over the world.

Hayes now was operating in a completely new world. New rules were created, regulations changed and employee surveillance increased. This is why he decided to move to Citibank and avoid being fired from Deutsche Bank.

At that time, in 2013, he lost his position at the bank. The solution was to keep in the industry or just change and find for new opportunities. This is where he left everything and started to trade Bitcoin. At that time, the famous virtual currency was traded close to $100 dollars and most of the financial world did not know about it.

As the cryptocurrency market was not yet so liquid, he spotted some interesting price difference between exchanges. Bitfinex and other Chinese exchanges offered bitcoin at 20% to 40% premium prices.

In order to do so, he started buying bitcoin from Bitfinex, and then sell it on the Chinese market. He was then withdrawing the funds in mainland China and returning to Hong Kong. After several months operating in this way, he then decided to set up a derivatives trading platform.

Hayes worked side by side with Ben Delo and Samuel Reed, both with experience in different fields. Delo worked at JP Morgan and Reed was a web platform developer. After testing for 11 months the exchange BitMEX, the exchange went live in 2014.

About it, Hayes mentioned:

“My family and friends always knew I wanted to be an entrepreneur not a career banker. They also saw how unengaged and bored I was while I was trading at various investment banks. [I] thought given my background as a derivatives trader, that I could build something better.”

The exchange was registered in Seychelles and operated out of Hong Kong. In 2015, liquidity levels were very low at the exchange, and indeed, he considered that the volume was ‘pathetic.’ However, he never stopped working and improving it for the future.

In October 2015, BitMEX allowed users to raise the leverage limit from 3x to 100x. Users were able to trade Bitcoin with important leveraged positions. In this way, traders provided liquidity and the exchange started to grow.

According to Hayes, liquidity continues to grow in 2018, even when the markets are operating down. As virtual currencies are volatile assets, they help users find good options to leverage their positions.

For the future, BitMex is thinking about great projects. He explained that they want BitMEX to become the largest trading platform in the world for all assets, and not only cryptocurrencies.

“We want to trade more notional value than the Chicago mercantile Exchange,” he said.

At the moment, BitMEX is moving its offices in Hong Kong to the Cheung Kong Center. Some new neighbors include Goldman Sachs and Bank of America.

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