Bitmex and BitFinex are two popular cryptocurrency exchanges that enable to traders to carry out future contracts, swaps and other activities. Though they are similar, there are quite a few differences between the two.
In this article, we will discuss the strengths and weakness of both Bitmex and BitFinex to help you get a better picture.
Bitmex was founded by former bankers and specialists in derivatives trading. It is registered in Seychelles and operates out of an office in Hong Kong. Bitmex specialises in perpetual and future trades of a fixed number of cryptocurrencies. And they only accept bitcoin for fees, deposits and withdrawals. Though it is an exchange, people do not come to Bitmex to exchange their XBT for ETH or some other coin. The principal function of Bitmex is derivatives and futures trading.
They offer 100x leverage on bitcoin trades, the best in the industry at very low verification levels. They are not beginner friendly but are popular among traders. They have an unprecedented level of security in their operations, including manual verification of withdrawals to reduce chances of fraud and hack attacks.
BitFinex is Hong Kong-based Exchange that can be best described as a Forex point for fiat and cryptocurrency. You can trade fiat currency after an id verification. Apart from personal id, they need a residence proof, bank statement, etc and it can be time-consuming and frustrating at times.
They have high USD liquidity owing to their ability to accept fiat currency for swaps. But their biggest weakness is the loss of reputation due to multiple breaches. They store 99.5% of their funds in multi-signature cold vaults at different locations. Despite this, hackers breached them twice and did away with millions of dollars worth bitcoin. While the company has reimbursed the victims of the first hack, the second one is yet waiting for resolution.
They have a full package of trading tools for margin trading and lending market. On the positive side, they tackled both the hacks brilliantly and have proven to be responsible and responsive in their handling of the issue. That has had a positive effect on its customer. But their trading volumes have been falling since the past several months.
Irrespective of which one you choose, it is important to be aware of the risks that come with trading, especially when trading with leverage.
Cryptocurrency market is filled with volatility, handle with care.