Crypto industry leveled in 2022 — BitMEX CEO
BitMEX CEO Stephan Lutz reflected on a tumultuous 2022 for the cryptocurrency industry, the effects of the FTX fallout and other recent major events.
BitMEX CEO Stephan Lutz believes the cryptocurrency industry is experiencing a period of resurgence despite the collapse of FTX and major lenders in 2022 having long-lasting effects.
The exchange and derivatives platform’s CEO painted a positive picture for the wider space in a wide-ranging interview with Cointelegraph, highlighting increased user numbers and trading activity some five months into 2023.
A reprieve from long-lasting market woes is pertinent for BitMEX. The platform has continued to operate while legal battles concerning co-founders Arthur Hayes and Benjamin Delo occurred in the background.
Lutz, who stepped in as acting CEO late in 2022 and also carried out the duties of the chief financial officer, described a period of tremendous change for the industry with unsurpassed global attention:
“Last year we saw a leveling of the industry. More began to pay attention to the need for proof of reserves, clear asset custody and stoic security.”
BitMEX has made its own efforts to ensure transparency with its users. According to Lutz, the platform began publishing proof of reserves and proof of liabilities data twice a week from August 2021. This in turn has allowed users to verify that account balances are included in the liability total of the platform.
Exchange tokens were also thrust firmly into the spotlight last year with the collapse of FTX intrinsically tied to the cryptocurrency exchange’s native FTX token. BitMEX launched its own native token (BMEX) on its platform amid the FTX saga and Lutz believes exchange tokens still serve a pertinent purpose in the industry:
“It continues to trade steadily, and as a utility token gives our traders an array of benefits on the exchange, from fee discounts to rewards.”
Lutz says BitMEX remains profitable and has seen an increase in users in 2023 as it continues to focus on derivatives offerings in the industry. It has also been “business as usual” for the company despite Hayes and Delo pleading guilty to violating the Bank Secrecy Act for prior Anti-Money Laundering failings over the past two years.
Current market events were also a topic of discussion, and the rise in meme tokens in recent weeks has trickled into the BitMEX ecosystem as well. The derivatives exchange has seen increased trading volume on tokens, including PEPE and AIDOGE:
“Just last week, our top trader took home over USD$600,000 in profit, the majority of which came from our newly listed 1TAIDOGEUSD perpetual swap.”
Lutz added that preview communications for new contracts featuring memecoins had been well received by BitMEX users, indicating the appetite for the space is apparent.
The nature of derivatives exchanges as market liquidity providers is centered around allowing traders to take advantage of market price movements. Experienced traders stand to gain a considerable amount on these platforms, as Lutz highlighted, with recent listings of perpetual swaps on meme tokens offerings users up to 50 times leverage — accompanied by high inherent risk.
BitMEX has been an active derivatives platform in the industry and only launched a cryptocurrency spot exchange midway through 2022.
Magazine: Ordinals turned Bitcoin into a worse version of Ethereum: Can we fix it?