This guide was created for all readers who would like to learn the principle of operation and navigate the Bitmex exchange. It describes the registration process, the most important options and detailed information presented graphically - on how to use the various functions of the exchange.
From the article you will learn:
- What is the Bitmex exchange
- What is trading on the lever
- How to play on the lever on the Bitmex marketplace
- What is the price of liquidation
- How to create an account on Bitmex - step by step
- What does the exchange interface look like
- How to set up a buy / sell position
- Useful supplements to help you trade
- Glossary of terms and detailed description of functions available on Bitmex
- Transaction fees
- Tips for risk management
What is Bitmex stock exchange?
Buy/Sell Ads Bitmexwhose creators are: Arthur Hayes, Ben Delo and Samuel Reed - was founded in 2014. It is currently the most popular cryptocurrency trading platform that allows the user to place a position with a maximum leverage of 100: 1 - thus giving the opportunity to increase profits, but also potential losses.
What is leverage?
Leverage trading, or the interchangeable term - leveraged or leveraged trading - involves borrowing funds to increase potential returns on a buy or sell transaction. Thanks to this, you can open positions many times greater than the current balance on your stock exchange account.
You have funds on your 1 BTC account. You want to make transactions on the x25 leverage. In this way, you can open a position with the value of 25 BTC - thanks to this, when the assumed position will go in the direction you have set - you will multiply your profit 25 times compared to the situation if you started this position without leverage, but you also bear the 25 risk of a greater loss - if the position moves in the opposite direction to the intended one. Of course, you can post a position for any amount, even worth 1 dollar.
It is December XUMUMX, the BTC price is around 2017 $. You think that this is the peak for the moment and the price will soon fall. So you assume a short position so-called SHORTS to buy back BTC when it will be in the price of e.g. $ 5000. The value of your position is $ 100, but you decided to use x100 leverage, this way you risk $ 100, but the leverage principle allows you to set up a position as if for $ 10000. The price went in the intended direction and on November 19, 2018, it reaches the price of $ 5000. Then you decide to close the deal. You made $ 30000 risking $ 100 - that's 30000% of the profit. Without leverage, you would have made $ 300. Of course, this is an abstract example, and the Bitmex exchange makes money in BTC and not in $, so it is variable - but I wanted to show you what possibilities and potential is a skillful use of leverage.
How to play on the leverage on the Bitmex marketplace?
The Bitmex stock exchange offers the possibility of trading in cryptocurrencies such as: Bitcoin, Cardano, Bitcoin Cash, EOS, Ethereum, Litecoin, Tron i Ripple. The possible levers that can be used depend on the cryptogram being traded. The highest possible lever is x100 on BTC, x50 on Ethereum, x33.33 on Litecoin and x20 on other, available cryptocurrencies.
All profits and losses are settled in the so-called XBT - this is the equivalent of the BTC name on the Bitmex exchange, therefore platform users must deposit and withdraw Bitcoins, while the value of contracts is converted into dollars (i.e. roughly: 1000 XBT contracts = 1000 $ with leverage x1, 1000 XBT contracts = 100 $ 10 at leverage, 1000 XBT contracts = $ 10 at x100 leverage).
When setting up a position - a trader (player, trader) has 2 options to choose from:
- long position, so-called LONG - opening this position means that you are counting on an increase in the price of a given stock and that you will make a profit by selling the position at a higher price - at the right moment for you
- short position, so-called SHORTS - opening this position means that you are counting on a decrease in the price of a given asset and that you will make a profit by buying the position at a lower price - at the right moment for you
Price of liquidation
When you open a position, part of your account balance is blocked by the exchange - as a security for funds that you borrow from the exchange using the given leverage. If the transaction is successful and you close the position with profit - your collateral will be returned to you (together with the profits) - minus the transaction fees. The same will happen if you want to exit a position by cutting losses. However, if the assumed position goes in the opposite direction from your intended one, and you do not close it on time - then - when the price reaches a certain price - your position will be automatically closed, and your security will be canceled - this is called the price of liquidation. All these data depend on the size of the balance, the size of the position, the leverage and are visible on the interface when setting up the position and while it is active - however, I recommend you use the special calculator available on the website where you can perform all the necessary calculations before entering into the transaction.
How to create an account on Bitmex - step by step
Go to the site Bitmex and create an account with your email address, password and country you are resident (note if you create an account from the referral link [green text] to have 10% lower transaction costs for the next 6 months):
After accepting the terms, click on registration - you will receive a verification email:
Then, he recommends entering his account:
iw security purposes - setting Google Authenticator on your account:
In order to deposit - go to the appropriate tab - copying your address for BTC payments and making the payment from some external source:
Once we have done this and our payment has been credited - we will see it in the appropriate tab showing the status of our account:
Bitmex exchange interface
Let's now familiarize ourselves with the exchange interface, where it describes its individual elements,
Cryptocurrency markets on which we can trade:
Book of orders, i.e. "Orderbook"where we can see the orders awaiting execution and the current price:
Currently made transactions purchase / sale:
Chartwhich also has technical analysis tools to assist in trading:
Table with current positions in the game or pending orders:
Table with summary of account balance (provided data on a current basis, in accordance with the current state of our positions):
Setting up a position
The next step after creating an account and posting our deposit is to create a position. How to do it? You can choose 2 options:
- via the buy option (Buy Market) or sell (Sell Market) - in this option, we buy or sell contracts at the currently best market price:
- through the buy option Limit (Buy / Long) or sell Limit (Sell / Short) - in this option, we buy or sell contracts at the price we want, which should be entered in the box Limit Price (then it automatically lands in "orderbooku"And waiting for implementation):
The size of the lever set by moving it to the appropriate position:
After confirmation position opening, it will appear in the table as active, it looks like this (on the example of the active long position (LONG) on the Ripple cryptocurrency), where we have given such data as: entry level, size, current rate, price of liquidation, amount of leverage or current profit at the position:
Useful supplements to help you trade
If you are a beginner - I recommend you to use the calculator on the exchange website as often as possible, thanks to which you can calculate all the data you need, such as: expected profit or loss, transaction cost, liquidation price, etc. - thanks to this you can avoid unpleasant surprises and learn how to how it works:
I highly recommend Bitmex version as well demo TZW. BITMEX TESTNET - it is a website for simulating the game like on a real stock exchange, but you can trade for virtual money here to get used to the interface, rules of operation and not to waste unnecessary funds if you make any mistakes at the beginning of your adventure.
Dictionary of concepts and available functions on the Bitmex marketplace
As an example, we will use an open short position SHORTS at the 3800 price, which is in our interest, that the price falls below this value:
Function Stop Limit
- it is used to close the position at the price we wish (in the example below: we issue Stop Loss Limitwhich is based on the fact that when the price goes wrong and reaches the level 3845 - our order will be inserted into orderbook and the item will be closed at the price 3850: (This is a risky option when we set a small price difference Stop Price for the price Limit Pricebecause with aggressive traffic - our order will not have time to be placed in the orderbook, because the price will go higher):
Function Stop Market
- it is used to close the position at the best current price, where in this example the first best should be the price 3845 (However, we have no guarantee that the order will be closed at this price, it may be a higher price eg after 3865, etc.):
Function Trailing Stop
- it is the so-called Stop Loss rollingwhere we determine the difference after which ours Stop Loss it will follow the current price (in the example in question it was founded SHORTS, the current price is 3828.5, so Stop Loss rolling is currently at the price 3838.5 ie about 10 dollars fixed the difference, when the price goes down eg to 3800ours Stop Loss rolling it will be on the level 3810. When the price keeps falling - ours Stop Loss rolling it will follow the price keeping the distance of $ 10 - and when the price goes up - ours Stop Loss rolling will stay in the same place and it will happen when the price reaches its level. Where we are founded LONG - the principle of operation is similar, but remember to insert minus before the value in the window Trail Value:
Function Take Profit Limit
- it is used to close a position or part of it at a price specified by us, when we want, for example, to take part of the profits or simply close the entire position (in this example: when the price reaches the level 3770, the order of purchase of a certain number of contracts at the price will be inserted in the orderbook 3760):
Function Take Profit Market
- it is used to close the position or part of it at the best market price when the price reaches the level of the issued instruction (in the discussed example: when the price reaches the level of 3750 - our order with a certain value will be closed - contracts will be purchased at the best available price currently, where the best price should be 3750 - thus realizing the profit per position SHORTS):
Other options (the use of these functions depends on many different situations when trading):
- when we have this option selected, each order will be executed (closed) when the price reaches this level (it should be selected for each type Stop Loss if we want our position to be closed or reduced)
- when we have this option selected - our order will be executed exactly at the price that we have specified or not at all (applies to the situation when opening a buy / sell order Buy / Sell Limit or Take Profit Limit) - otherwise - the order will be executed at the market price (Market)
- when we have this option selected - our order to close the position by option Buy / Sell Limit - will be treated as only those used to reduce the position (e.g. we have an open position of 1000 contracts SHORTS at the price 3800 and pending order at the level 3840 for the next 1000 contracts, the current price is: 3815. We also have an open order closing transactions with a profitable level 3750 (or position LONG) worth 2000 contracts. So we don't know if the price will "grab" our level order first 3840 and go down to 3750or maybe immediately from the level 3815 will fall to 3750 and will make a profit. Therefore, the option is a safeguard Reduce onlythanks to which he will not open a new order in such a situation LONG (which we do not want) - it will only close the position regardless of its value.
- here we indicate which price we refer to when executing our orders, Mark - average price from Last and Index, Last - last transaction price on the Bitmex orderbook, Index - average price from Coinbase + BitStamp exchanges. These prices vary, I recommend that you keep them checked Last.
This is the x100 leverage, the difference is that in the case Cross - our security is the entire capital available on the account. The liquidation price, therefore, can be much more distant than if we assumed a position on the lever, e.g. x50 or x100. It is very convenient for experienced traders who know what they are doing, because in this way we can have a position, e.g. -800% in the minus and it will not be liquidated as in the case of ordinary leverage, because the security is taken from the account balance until it is reset.
What is Funding
At the top, in the right corner of the screen, we can see a characteristic clock measuring 3 times a day - counting the so-called counting every 8 hours. fundingu - fee set by a special algorithm of the exchange based on open positions. When someone has position LONG on the leverage x100 - in the example above, he will receive approx. 8% of the value of his position from traders with open positions SHORTS. This is an alternation (usually when there is a strongly downward trend - they pay the fee SHORTY and analogically - in the case of a strong upward trend - the fees pay LONGI).
Transaction fees, i.e. fees they depend on how we open or close our positions:
- if we use the function Buy / Sell Limit - we will be paid a fee - it will be 0.025% on the value of the item
- if we use the function Buy / Sell Market, Stop Limit Market, Stop Market, Trailing Stop, Take Profit Limit, Take Profit Market - we will pay each time 0.075% on the value of the item
In the case of x100 leverage - it is therefore a fee of up to 7.5% of item value, which in the long run affects our budget. The solution is to use the first option as often as possible. You can also reduce this fee to 0.0675% first 6 miesięcy Bitmex games for all transaction fees in every cryptocurrency market, if you set up an account with the referral link.
A detailed table with fees depending on the market in which we trade:
Tips for risk management
- at the beginning, play for small amounts, in this way minimize losses due to inexperience and mistakes
- Practice as much as possible to get used to the interface and stock market navigation
- Limit your lever, do not play on the x100 lever until you gain experience
- choose one market, do not be distracted by jumping from trading one cryptocurrency to another, in this way you will get to know and focus on one asset, thanks to which it will be easier to understand price changes and trends
- use orders as often as possible Limitto pay the smallest transaction fees
- be patient
Bitcoin and many other cryptocurrencies are famous for their volatility and price spikes that cause their prices to fluctuate significantly in a short time. It is a profitable opportunity if you approach it wisely and carefully. If you feel up to it and want to start earning also during the current bear market, you are also aware of the financial risk - Bitmex market will help you increase profits regardless of whether the price of Bitcoin will grow or fall.