- Arthur Hayes explains why the platform won’t have as many assets as Binance.
- BitMEX CEO speaks about the market development.
Cryptocurrency merchant exchange platform that allows trading Bitcoin and other digital coins with up to x100 leverage announced that it had no plans to expand the range of tradable instruments in the foreseeable future.
Derivative products require significant liquidity on the spot market, while is is not the case with smaller coins, Arthur Hayes, the co-founder and CEO of BitMEX, explained in the recent interview with a crypto analyst and trader Luke Martin.
“So you know, in my opinion, the futures market should always be tighter and trade larger than the underlying of this derivative. And that only happens if you have sufficient liquidity in the spot market,” he said.
Also, according to BitMEX head, by adding various assets from CoinMarketCap’s list, the platform would deprive market-makers of the ability to hedge risks due to excessively wide spread.
“From a client perspective, as a terrible experience, I’m treating a leveraged product that has a wider spread Than the underlying on the spot market, and I’m just increasing my risk of getting liquidated. And that’s something that we don’t want to do.”
Currently, the trading platform supports future contracts on Bitcoin, Ethereum, Cardano, Bitcoin Cash, EOS, Litecoin, Tron and XRP. What’s more, users have access to perpetual swaps on BTC and ETH.
Earlier we reported that Arthur Hayes projected the Bitcoin growth towards $50,000 in 2-5 years.
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