HDR Global Trading Limited Hires Derek Gobel as General Counsel

As a growing company we are always looking to bring on exciting new talent. It is our mission to be as successful and relevant in decades to come, as we are today. To do this, we recognise we need the right people, resources and capabilities to help us stay ahead of the market and continue to provide the best experience for our traders.  

This is why we are thrilled to announce that HDR Global Trading Limited has appointed Derek Gobel as our group’s General Counsel. He will oversee the group’s legal function and help us move forward in today’s continually evolving regulatory environment.

Derek brings with him 28 years of experience working on a wide range of legal matters, including his most recent role as BNP Paribas’ General Counsel for APAC. Recognised in the 2017 Legal 500’s GC Powerlist in China and Hong Kong, we look forward to having him on board.

Q4 2019 Quarterly Futures Listings & TRX Index Rename

On 13 September 2019 at 08:30 UTC, BitMEX will list new quarterly futures.

Please see the following tables for listings and settlements for current and upcoming futures contracts for Q4 2019. Bolded rows are the new contracts.

The .TRXXBT index will retire on 27 September 2019. It will be replaced by the .BTRXXBT Index. TRXU19 will reference .TRXXBT until its Settlement Date, TRXZ19 will reference .BTRXXBT from its Listing Date. 

Code Pair Listing Settlement
ADAU19 Cardano / Bitcoin 14 June 2019 27 Sept 2019
ADAZ19 Cardano / Bitcoin 13 Sept 2019 27 Dec 2019
BCHU19 Bitcoin Cash / Bitcoin 14 June 2019 27 Sept 2019
BCHZ19 Bitcoin Cash / Bitcoin 13 Sept 2019 27 Dec 2019
EOSU19 EOS Token / Bitcoin 14 June 2019 27 Sept 2019
EOSZ19 EOS Token / Bitcoin 13 Sept 2019 27 Dec 2019
ETHU19 Ether / Bitcoin 14 June 2019 27 Sept 2019
ETHZ19 Ether / Bitcoin 13 Sept 2019 27 Dec 2019
LTCU19 Litecoin / Bitcoin 14 June 2019 27 Sept 2019
LTCZ19 Litecoin / Bitcoin 13 Sept 2019 27 Dec 2019
TRXU19 Tron / Bitcoin 14 June 2019 27 Sept 2019
TRXZ19 Tron / Bitcoin 13 Sept 2019 27 Dec 2019
XRPU19 Ripple Token (XRP) / Bitcoin 14 June 2019 27 Sept 2019
XRPZ19 Ripple Token (XRP) / Bitcoin 13 Sept 2019 27 Dec 2019
XBTU19 Bitcoin / USD 15 Mar 2019 27 Sept  2019
XBTZ19 Bitcoin / USD 14 June 2019 27 Dec  2019
XBTH20 Bitcoin / USD 13 Sept 2019 27 Mar 2020

Efficient Liquidity Pools, 20 August 2019

To encourage efficient trading strategies and incentivise behaviours that improve the executable liquidity of the market, BitMEX will be gradually introducing a number of trading rules for the platform. These rules are specifically designed to improve the quality of the exchange offering for users and are the result of a large amount of research over the past few months. This concept is nothing new and indeed most traditional venues employ similar rules.

You can read more about the first Trading Rule to be introduced in our API Announcement on the Quote Fill Ratio Threshold. This rule aims to discourage the use of strategies that submit quotes to the market without the intent to trade and therefore further strengthen the quality of liquidity on the platform in addition to freeing resources for other market participants.

We believe the introduction of these rules to be a positive step forward for the industry and we are committed to continuing innovation in the space.

Background

For many years now, BitMEX has been the most liquid market offering cryptocurrency derivatives. A key indicator of the quality of a market is the depth and size of the quotes in the order book: liquidity is often measured by price slippage for a given volume to execute. Sk3w.co offers a visual comparison of the price slippage across various cryptocurrency markets. In the sample below, the implied bid-offer spread for executing 1000 XBT worth of contracts on BitMEX’s XBTUSD market fluctuates around 0.5%. Compare this with other venues, where price slippage is roughly 10x higher, ranging from 3% to over 15%.

 

Source: https://www.sk3w.co/liquidity

 

Since day 1, BitMEX has provided unprecedented access to the platform through our industry-leading API. Every action that can be performed on the BitMEX.com website, can also be performed via our API. In fact, the BitMEX.com web interface is just a client of our public API. This open approach has been a key contributor to BitMEX becoming the most liquid market in the industry.

Liquidity is only useful however if it is genuinely executable liquidity. In the month of June, fewer than 2% of active users on BitMEX accounted for over 60% of the order management requests processed, and less than 2% of the volume traded. Users fitting this behaviour profile are incredibly inefficient with their use of the API, submitting a disproportionately high number of orders per contracts traded.

There are a number of explanations for this kind of API usage. We often discover accounts that have signed up to an online automated trading service (or “bot”), entered their API keys, and then forgotten entirely about the account whilst it continues to place/amend/cancel thousands of orders every day. Other times, it could be a misconfigured trading system or client algo, which is quoting too wide and very rarely trades.

This kind of behaviour, whilst not currently against the rules, takes resources away from participants genuinely looking to trade on the platform. We believe that discouraging this kind of behaviour will further strengthen the liquidity of the market and provide a better overall experience for users.

If you have any further questions please contact Support via our contact form: https://www.bitmex.com/app/support/contact.

Ensuring the Continued Compliance of the BitMEX Platform, 19 August 2019

In 2014, HDR Global Trading Limited (HDR) was founded in Mahé, Seychelles as a small, dedicated team of young entrepreneurs focused on a simple mission: to build a crypto trading platform geared toward experienced traders first. We focused on building the most responsive interface, featuring groundbreaking products, controlled by a complete and seamless API, with the tightest security. From those ideals, BitMEX was built.

The market has spoken: BitMEX has succeeded. We are proud to have built the most innovative, reliable, and secure cryptocurrency platform in the world.

As BitMEX grows, so the world grows with it. In 2013, only months before we began, Bitcoin had just crashed from its second major bull-run. The dreams and wallet balances of the greater crypto community crashed with it. A new set of priorities emerged, focusing on safety, security, and stability. Financial regulators started to pay more attention to Bitcoin, and rightly so. It was clear to all of us that new standards were needed for this new industry.

Since then, the cryptocurrency landscape has changed dramatically, and leaders such as BitMEX have been working with regulators to help shape the industry, creating the standards that will help it go mainstream. 

The increased involvement of regulators with all the major players in the industry is not only to be expected, it is to be welcomed. It is the mission of good regulators to ensure that honest citizens are not being cheated. Regulators bear the burden of ensuring that risks are clearly communicated, products are fair, and taxes are collected. Through this process, we will see a new era of legitimacy for cryptocurrency exchanges: a future where market operation standards are clearly stated and maintained, where security is paramount, and where financial reserves are independently and frequently audited.

We believe fervently in these goals. And we understand that nothing is more sacred than the safety of your funds and the stability of the platform.

For this reason, we have decided to restrict access to BitMEX for users in the jurisdictions in which HDR-affiliated employees and offices are located. Seychelles, Hong Kong and Bermuda will be added to the list of jurisdictions already restricted from access to BitMEX. This change will have no financial impact on the business and will affect very few people. The BitMEX team will be reaching out to those who are affected. 

The BitMEX platform is entering a new and exciting era. This conservative action is not taken reactively, but proactively. We want to ensure we lead the industry not just in innovation but also in standards. 

  • We are extending the transparency of our systems so that our customers and stakeholders can better understand how BitMEX operates. 

  • We are showing third-parties why we believe BitMEX is a safe place to trade; how our innovative contracts are structured; why we keep an Insurance Fund; how auto-deleveraging is orderly and fair; how we know all accounts are 100% backed; and why we believe BitMEX has one of the safest custody solutions in the world. 

  • We are working on independent audits of our Insurance Fund, market making activities, and tradeable contract structure and we hope to share the results of these processes in the near future.

We believe success in the cryptocurrency space lies in the ability to think long-term, not short-term. And in that long-term view, we believe this course of action affords us the best opportunity to engage regulators in deep, thoughtful, and productive explorations of the risks and opportunities present in the cryptocurrency market.

BitMEX will not just be the most liquid, innovative place to trade. It will also be one where customers may rest assured – with independent affirmation – that accounts are solvent, settlements are honest, and all participants enjoy the same access and opportunity to Trade More.

WebSocket API Feed Interruption, 24 July 2019

Between 10:44:13 and 10:52:29 UTC on 24 July 2019, the realtime data on the following websocket API feeds was interrupted:

  • account, affiliate, execution, funds, instrument, margin, order, position, trade, transact, wallet

Users of the BitMEX website may have noticed that some data was not updating during this period; e.g. in the Recent Trades panel, Open Orders panel, Fills panel, and Position panel.

The following public feeds were unaffected during this period:

  • funding, insurance, liquidation, settlement, impactQuote, impactQuoteBin1m, quote, quoteBin1m, quoteBin5m, quoteBin1h, quoteBin1d, tradeBin1m, tradeBin5m, tradeBin1h, tradeBin1d, orderBookL2_25, orderBook10, orderBookL2

The REST API was also unaffected and client-side data loss due to missed feed updates during this period can be resolved using the REST API.

During this period we continued to process all order instructions and the trading engine was unaffected. The outage was due to a slow consuming internal market data service which became degraded, putting pressure on our market data infrastructure. This internal market data service has been suspended whilst the root cause is being investigated. Additionally, several safety mechanisms are currently being deployed to prevent a potential recurrence from impacting user-facing feeds.

We apologise for any inconvenience this interruption may have caused. If you have any further questions please contact Support via our contact form: https://www.bitmex.com/app/support/contact.

Update to BitMEX Indices, 15 July 2019

Effective 15 July 2019 at 15:15 UTC, BitMEX will reintroduce Kraken into its indices following the resumption of trading on Kraken. The updated indices are detailed in the table below.

All traders should be aware that these indices may fluctuate substantially, and should exercise caution when trading contracts that reference these indices.

If you have any further questions, please contact Support via our contact form: https://www.bitmex.com/app/support/contact.

Affected Index

Index Constituents

.BXBT

Bitstamp, Coinbase Pro, Kraken

.BETH

Bitstamp, Coinbase Pro, Kraken

.BETHXBT

Binance, Poloniex, Kraken

.BBCHXBT

Binance, Poloniex, Kraken

.BXRPXBT

Binance, Poloniex, Kraken

.BLTCXBT

Binance, Poloniex, Kraken

.BEOSXBT

Binance, Poloniex, Kraken

Temporary Change to BitMEX Indices, 14 July 2019

Effective 14 July 2019 at 21:00 UTC, BitMEX will temporarily remove Kraken from its indices in response to Kraken’s scheduled downtime. This scheduled downtime is expected to last for 3-8 hours and will affect the 7 BitMEX indices as detailed in the table below.  Kraken will be reintroduced once trading has resumed. We will announce their reintroduction 12 hours in advance.

All traders should be aware that the price of these indices may fluctuate substantially, and should exercise caution when trading these indices.

If you have any further questions, please contact Support via our contact form: https://www.bitmex.com/app/support/contact.

Affected index

Current constituents

Temporary constituents

.BXBT

Bitstamp, Coinbase Pro, Kraken

Bitstamp, Coinbase Pro

.BETH

Bitstamp, Coinbase Pro, Kraken

Bitstamp, Coinbase Pro

.BETHXBT

Binance, Poloniex, Kraken

Binance, Poloniex

.BBCHXBT

Binance, Poloniex, Kraken

Binance, Poloniex

.BXRPXBT

Binance, Poloniex, Kraken

Binance, Poloniex

.BLTCXBT

Binance, Poloniex, Kraken

Binance, Poloniex

.BEOSXBT

Binance, Poloniex, Kraken

Binance, Poloniex

HDR Global Trading Limited Provides US$60,000 Grant to Bitcoin Developer

Following on from our 28 May 2019 announcement of a donation to the MIT Digital Currency initiative, we are delighted to announce a US$60,000 grant to Bitcoin Core contributor, Michael Ford (AKA fanquake). Michael has been a Bitcoin contributor since 2012 and has recently been added to the list of maintainers for the Bitcoin Core software project.

HDR Global Trading Limited (which owns and operates the BitMEX cryptocurrency trading platform) is proud to support Bitcoin development and engineering, aimed at improving Bitcoin’s robustness, scalability and privacy. The grant is non exclusive and requires Michael to work on Bitcoin Core. We are pleased to be Michael’s first financial supporter during his time as a Bitcoin Core maintainer.

Sam Reed, CTO and co-founder of HDR Global Trading Limited, made the following remark about the grant:

HDR Global Trading Limited, like all other companies in the cryptocurrency space, relies heavily on the (mostly-volunteer) work of coders dedicated to the mission and ideals of Bitcoin. This work is difficult, demanding, and often thankless. We believe it is the duty of corporations to give back to the projects from which they benefit – and from which their very business model stems. Without the millions of free man-hours from dedicated OSS developers powering everything from our operating systems, to our web servers, to our ops tools and Bitcoin itself, the BitMEX trading platform could not have been built. We don’t forget this gift. Therefore, HDR considers this grant, provided on a no-strings-attached basis, to be only a small part of an ongoing commitment to bolstering Bitcoin and other OSS projects for the benefit of all.

 

Libra: Zuck Me Gently



The event horizon has passed. With Libra, Facebook begins its foray into the digital asset industry. Before I begin my analysis, let’s get one thing straight; Libra is not decentralised nor censorship resistant. Libra is not a cryptocurrency. Libra will destroy all stablecoins, but who gives a fuck. I shed no tears for all those projects that somehow believed there was value in a an unheard-of sponsor creating a fiat money market fund that rode on a blockchain.
 
Libra could lay commercial banks and central banks low. It might reduce their usefulness to a dumb regulated warehouse for digital fiat money. And that is exactly what should happen to these institutions in a digital age.

Why Do Commercial Banks Exist?

Banks came about during a time of great danger for members of the human society. In feudal Europe you most likely worked dawn-till-dusk on the farm. Any meagre savings you or your feudal lord amassed were constantly under siege. Given that money was physical in nature, if you or your lord left the protection of the town, theft was likely.
 
Safety of assets has been the most important value proposition for traditional banks. They could store physical assets and records safely in their vaults. Therefore, governments and wealthy individuals stored money and assets with banks. Banks were and are engaged in a massive confidence game. That is why bank building edifices portray a certain fortified grandeur. In a generation, your assets will still be there, intact and ready for use.
 
Through their partnership with the government, banks obtain a license to issue credit and expand the money supply. They also rely on the legalised violence of the government to enforce contracts. Don’t pay the bank back, they will confiscate the encumbered asset. Should you defy the courts, a government goon will happily press boot to neck, and ensure your compliance.
 
In the last decade, human civilisation’s money and assets quickly transitioned from analogue to digital representations. Money and representations of ownership travel electronically rather than on the back of a horse. If assets and money are now digital, do we need institutions that provide physical rather than digital security?
 
As we have seen, commercial banks are terrible at securing digital information. Pick your large too-big-to-fail bank, and there will be a story about the “leakage” (euphemism for “we have no fucking clue how to safeguard your digital property”) of customer data.

Whoever has the customer, has the value

Previously banks held the most valuable information about customers. They had your whole financial history, and information about where you lived and what you bought.
 
In the past ten years, social media companies through voluntary actions of their users, amassed the most amount of personal information in human history. We share every detail of our lives on Facebook, Instagram, Google, Twitter, WeChat, LINE, Kakao Talk etc. We send billions of messages on centralised chat programs controlled by those same institutions as well. They now own the customer.
 
The modern consumer technology companies own billions of the wealthiest customers’ data. Previous to now, these companies made money on advertising and selling a product. But as with all businesses, once you are successful capturing customers, you start offering financial services.
 
Facebook has almost 2 billion daily active users. It makes complete sense to own the financial existence of their chattel. That is Libra.

Libra Deconstructed

Libra is a stablecoin backed by a basket of fiat currencies. The fiat currencies sit in a dumb regulated commercial bank. Libra allows a privileged few the ability to create and redeem Libra at its Net Asset Value (NAV). Libra rides on a blockchain where certain parties operate permissioned nodes. These parties included VC firms, technology companies, retail merchants, cryptocurrency exchanges, and most importantly commercial banks and credit card processors.
 
Libra may invest into short term government bonds, or into anything the Foundation board allows. The income earned is not passed onto the pleb Libra users, but the node operators and Libra investment token investors. The Foundation is the governing body of the Libra ecosystem. The members are selected based on the industries they represent, and their economic investment into the ecosystem. 
 
Libra does not connect real-world identities to addresses. However, you can bet that converting assets into Libra will encounter KYC. And let’s be clear, any request from a government agency to freeze a transaction will be met with compliance. Therefore, do not use Libra to buy your mood-altering substance(s) of choice.

Impact on Consumers

Many of Facebook’s users reside in places with low financial services penetration. Imagine a world where a Filipina helper can purchase goods sold in Europe with Libra. She most likely does not have great banking services where she works as an overseas foreign worker. Therefore, purchasing goods from foreign countries over the internet is difficult. With Libra, there is no issue.
 
The merchant in Europe receives payment in a basket of fiat currencies they already deal with. This transaction can happen completely inside of one of Facebook’s social media properties like Instagram or Whatsapp.
 
Facebook or a new financial services company it creates, can issue loans at the point of sale denominated in Libra. A user can opt-in to allow Facebook to use all its data on the individual to compute a credit score. Using that credit score, Facebook will lend Libra at a rate to purchase goods from merchants selling on the Facebook platform. Voila, the poorest members of our global society can experience the joys of purchasing mass-produced Chinese knick-knacks on credit. Welcome to Pax Americana!

Impact on Commercial Banks

Commercial banks make money lending. They use retail deposits to make these loans. Unfortunately, in this digital age, they no longer have the best information set about these retail depositors. The social media companies do.
 
Therefore, the Facebook, Google, and Alibaba’s of the world can originate a loan cheaper and offer a lower interest rate than a commercial bank. Libra and the plethora of copycats to come, allow technology companies to use a digital fiat representation in their ecosystems to extend credit and offer all of the most profitable banking products at a much lower cost. These global tech behemoths have billions of free cash flow on their balance sheets to lend.
 
Commercial banks can become node operators or regulated warehouses for the reserve assets of the stablecoin in question. There is still economic value in both of these verticals, but consumer technology companies will now sell the most profitable financial products themselves.
 
Any bank should be on notice, Libra and its clones are existential threats to their business models. Many will cheer as banks’ profit centers are eviscerated. But maybe society is trading one devil for another.

Impact on Central Banks

Commercial banks are not needed at their current largesse in a digital economy. With Libra, Facebook is assuming the role of a central bank. The Libra reserve is managed by a third-party foundation. The reserve managers choose the fiat currency weights, and how funds are invested. Sounds a lot like the job scorecard of a central bank governor.
 
Consumer tech companies can now issue, from their own balance sheet, credit directly to consumers. The only difference with this model is that they, for now, are not able to actually create money like commercial banks. This is the flow:
 
1.     Take retained fiat earnings, and exchange for Libra with an authorised primary dealer.
2.     Lend Libra to your customer in exchange for a good or service you offer.
3.     Obtain Libra + interest in Libra back from your customer.
4.     Sell Libra in exchange for fiat with an authorised primary dealer.
 
The money supply does not expand. That is the one major divergence from how a central bank issues credit into an economy. Central banks’ lending in most cases increases the aggregate supply of money.
 
Why trust a few crusty old men and women to manage the monetary health of the global economy. Let’s trust Zuck!
 
I have no love lost for US Representative Maxine Waters’ idiotic statements and actions on the US House Financial Services Committee. But her and other government officials’ outbursts of concern are not driven by altruistic feelings towards their subjects, but rather a fear of the upending of the financial services industry that lines their pockets and keeps them in office. The speed at which government officials rushed to admonish Libra tells you there is some potential positive value to human society embedded in the project.

Libra and Financial Privacy

It is amusing to see how many people rushed to complain about the potential loss of financial freedom Libra could represent. This fear is misplaced, financial privacy is already non-existent, nor will it ever exist in a digital fiat money system. Whether it be Facebook, The Fed, or The PBOC, centralised electronic fiat money is coming – cash will be outlawed.
 
The great thing about the launch of Libra is that it forces those concerned about the loss of financial privacy to explore alternatives. Bitcoin and other cryptocurrencies will benefit as curious plebs contemplate how secure financial privacy in this new digital age.
 
Libra and the conversations it sparked, is the best news for Bitcoin. Two billion people will now embrace and potentially be frightened of a corporate overlord controlling their financial wellbeing. Curiosity is the best food for the Bitcoin bull market.

Through their investments in augmented and virtual reality, it appears that Facebook wishes to create a completely new digital world. Libra could be the financial mana that powers this virtual existence. Let’s hope that while we are vegetating in our haptic pods, our physical shells don’t get Zucked too hard. Please Zuck me gently, and Zuck me long time.

WebSocket API Feed Interruption, 27 June 2019

Between 07:50 and 07:58 UTC on 27 June 2019, the following websocket API feeds were interrupted due to a complication during a planned upgrade of our market data distribution services:

  • Account, affiliate, execution, funds, instrument, margin, order, position, trade, transact, wallet

Users of the BitMEX website may have noticed some data not updating during this period e.g. in the Recent Trades panel, Open Orders panel, Fills panel, and Position panel.

The following public feeds were unaffected during this period:

  • Funding, insurance, liquidation, settlement, impactQuote, impactQuoteBin1m, quote, quoteBin1m, quoteBin5m, quoteBin1h, quoteBin1d, tradeBin1m, tradeBin5m, tradeBin1h, tradeBin1d, orderBookL2_25, orderBook10, orderBookL2

During this period we continued to process order instructions and the trading engine was unaffected.

Due to this issue, data in a subset of data mirrors which service user REST API requests was left in an incomplete state. A side-effect of this was that some users observed stale open orders on the BitMEX website for orders which were already cancelled for a period of 90 minutes whilst data was being restored. Any API users that may be missing updates for this period can now backfill data via the REST API.

If you are experiencing order cancellation issues via the website, please refresh your web browser.  We apologise for any inconvenience this interruption may have caused. If you have any further questions please contact Support via our contact form: https://www.bitmex.com/app/support/contact.

ETHUSD Orderbook Feed Issues, 24 June 2019

Between 09:25:54 UTC and 09:44:30 UTC 24 June 2019 the orderBookL2, orderBookL2_25, orderBook10, and quote realtime websocket feeds for ETHUSD were in a degraded state. During this period, the state of the ETHUSD orderbook on these feeds was incorrect.

We were able to identify and resolve the root cause of the issue within a minute of detection. The issue was caused by a rare sequence of order events that triggered a bug in an optimisation of the orderBookL2 calculation which had been deployed to the production environment several hours earlier. This change has since been reverted.

There was no impact to orders in the trading engine itself – just the presentation of the calculated orderbook for ETHUSD downstream of the trading engine.

We have deployed additional automated feed validators to detect potential similar issues in the future and to alert us earlier.

We apologise for the inconvenience this may have caused. If you have any further questions, please contact Support via our contact form: https://www.bitmex.com/app/support/contact.