BitMEX and OKEx: Analysis on Futures Contracts
Although BitMEX, as a market leader driving the recent development of futures trading, enjoys advanced contract matching technology and excellent market depth, OKEx’s futures trading has, since 2014, laid a better foundation for futures products and major cryptocurrencies, other than bitcoin, with its broader experience in operation and technology development.
OKEx is on its way to surpass BitMEX in the futures trading market from 2019 onwards. This dates back to the second half of 2018 when OKEx started to invest extra resources in its products and techniques. The following is a peer comparison analysis of OKEx and BitMEX, the world’s two leading cryptocurrency derivative exchanges, across four key indicators, namely market types, range of underlying assets, transaction fees, as well as their order types.
- Market Types
As per product types, futures contracts dominate the crypto derivatives market. Certain spot exchanges, such as Bitfinex, support margin trading as a cornerstone for derivatives trading. However, there are very limited newcomers joining the derivatives market due to high technology and capital thresholds in developing a derivatives trading platform.
Figure 1: Major types of derivatives traded in cryptocurrency derivative exchanges
According to figure 1, OKEx, as a globally leading futures and spot exchange, offers more trading markets, namely margin, spot, and over-the-counter (OTC) trading, than BitMEX, except for crypto options. Nevertheless, OKEx will become the only cryptocurrency exchange covering all of the above six markets in figure 1 after rolling out its options trading service around September or October in 2019.
- Range of Underlying Assets
In respect of the underlying assets offered by the two exchanges, OKEx offers perpetual swap, quarterly, bi-weekly and weekly futures contracts of nine cryptocurrencies along with margin trading of 12 cryptocurrencies. On the other hand, BitMEX is primarily engaged in BTC and ETH perpetual swap trading and offers quarterly futures contracts for 8 cryptocurrencies. Because of their different target clienteles, their products are catered to different types investors and thus incomparable.
- Transaction Fees
To enhance market liquidity, BitMEX offers fee rebates to market makers and charges higher fees from liquidity takers. Meanwhile, OKEx has a tiered fee schedule for traders with different trading volume.
- For general users, OKEx provides fee discounts to holders of OKB, the exchange’s native token. A user who holds up to 2,000 OKB can enjoy a maker rate and taker rate of 0.015% and 0.030% respectively for futures trading, which are slightly lower than BitMEX’s.
- OKEx’s VIP users enjoy greater discounts for greater trading volume. OKEx’s VIP’s maker and taker fee rates are much lower than those charged by BitMEX, appropriately by 30% – 90%.
Figure 3: Comparison of OKEx and BitMEX’s transaction fees
- Order Types
Both OKEx and BitMEX provide six order types for futures and perpetual swap trading. Their order types allow traders to take advantage of their automated trading system to place orders according to users’ predefined strategies and parameters.
Figure 4: Comparison of order types offered by major crypto derivatives exchanges
In summary, by comparing the OKEx and BitMEX’s crypto derivative products in four major aspects, it is discovered that OKEx offers more trading markets, lower fees, more order types, and a wider variety of underlying assets, which likely contribute to a better trading experience of users. Facing the structural advantages of OKEx, it is challenging for BitMEX to surpass the former within a short period of time.