BIT Exchange Review
What is BIT Exchange?
BIT Exchange is an exchange registered in the Seychelles, but with headquarters in Dubai. It was launched on 3 August 2020 by Matrixport.
This exchange is primarily (but not only) a derivatives exchange, meaning that they focus on derivatives trading. A derivative is an instrument priced based on the value of another asset (normally stocks, bonds, commodities etc). In the cryptocurrency world, derivatives accordingly derive its values from the prices of specific cryptocurrencies. You can engage in derivatives trading connected to the following cryptos here: Bitcoin, Ethereum and Bitcoin Cash.
It has lately become a full-suite exchange supporting the perpetual, futures, and options products of BTC, ETH, and BCH, with a particular highlight being the platforms pionership in BCH options.
On the date of first writing this review (21 June 2021), the trading volume at this exchange was USD 30.2 million. However, on the date of last updating this review (2 December 2021), the 24-hour trading volume had reduced significantly. According to Coinmarketcap, the trading volume was USD 8 million. On the same day, the biggest exchange out there (Binance), had a 24 hour trading volume amounting to USD 30 billion...
BIT has an ambassador program looking for crypto enthusiasts and influencers, in order for the platform to expand its community. Once onboarded, the ambassador can get a up to 50% commission rebate generated by its referred users on a monthly basis. As the ambassador, you will be granted early access to upcoming new features, and regular online meetings with the BIT-team to learn about the latest industry trend, plus an allegedly "exclusive" BIT-swag package.
You can sign up to the ambassador program here.
For its crypto derivatives products, BIT Exchange allows you to trade with leverage. This means that you can receive a higher exposure towards a certain crypto’s price increase or decrease, without actually holding the necessary amount of assets. You do this by “leveraging” your trade. In simple terms, this means that you borrow from the exchange to bet more. You can get as much as 50x leverage on futures, and 10x leverage on options, here.
BIT launched its Unified Margin-account in November 2021. Unified Margin is an upgraded trading and risk management system, adopting one single account solution to optimize spot trading, margin trading, perpetuals, futures, and options. All collateral cryptocurrencies in the unified account are shared as USDT denominated margin to improve capital utilization, thus lowering the risk of being liquidated.
Rebalancing Market Maker Strategy
With the initial funds and threshold as inputted by the investor, the system calculates the initial balance ratio and places orders accordingly. When the market price drives the change of the portfolio ratio to deviate from the acceptable range, which is the pre-set threshold, a limit order will be filled to pull the ratios back to the initial level, thus achieving automatic rebalancing.
For example, I want to maintain 80% of my portfolio to be BTC, and 20% to be ETH. I will then - through this rebalancing function - sell BTC when the price thereof is appreciating but where ETH at the same time is depreciating - in order to maintain the pre-determined ratio.
Most crypto traders feel that desktop give the best conditions for their trading. The computer has a bigger screen, and on bigger screens, more of the crucial information that most traders base their trading decisions on can be viewed at the same time. The trading chart will also be easier to display. However, not all crypto investors require desktops for their trading. Some prefer to do their crypto trading via their mobile phone. If you are one of those traders, you’ll be happy to learn that BIT Exchange’s trading platform is also mobile compatible. You can download it to/from both the AppStore and Google Play.
Why do so many exchanges not allow US citizens to open accounts with them? The answer has only three letters. S, E and C (the Securities Exchange Commission). The reason the SEC is so scary is because the US does not allow foreign companies to solicit US investors, unless those foreign companies are also registered in the US (with the SEC). If foreign companies solicit US investors anyway, the SEC can sue them. There are many examples of when the SEC has sued crypto exchanges, one of which being when they sued EtherDelta for operating an unregistered exchange. Another example was when they sued Bitfinex and claimed that the stablecoin Tether (USDT) was misleading investors. It is very likely that more cases will follow.
According to information we have received, US-investors are indeed permitted to trade at BIT Exchange. Any US-investors should however also form their own opinion on this, as various state rules could also be an obstacle in their cryptocurrency trading.
BIT Exchange Trading View
Every trading platform has a trading view. The trading view is the part of the exchange’s website where you can see the price chart of a certain cryptocurrency and what its current price is. There are normally also buy and sell boxes, where you can place orders with respect to the relevant crypto, and, at most platforms, you will also be able to see the order history (i.e., previous transactions involving the relevant crypto). Everything in the same view on your desktop. There are of course also variations to what we have now described. This is the trading view at BIT Exchange:
It is up to you – and only you – to decide if the above trading view is suitable to you. Finally, there are usually many different ways in which you can change the settings to tailor the trading view after your very own preferences.
BIT Exchange Fees
BIT Exchange Trading fees
Every time you place an order, the exchange charges you a trading fee. The trading fee is normally a percentage of the value of the trade order. Many exchanges divide between takers and makers. Takers are the one who “take” an existing order from the order book. Makers are the ones who add orders to the order book, thereby making liquidity at the platform.
Here, takers pay 0.07% and makers pay 0.02% for their spot trading. According to the most extensive industry report ever prepared on average trading fees, the industry average spot trading taker fee was 0.215% and the maker fees 0.162%. So BIT Exchange are substantially below average regardless of which trader group you belong to.
With respect to the global average contracts trading taker fee and maker fee, these were 0.063% for takers and 0.018% for makers. BIT charges 0.05% for takers and 0.02% for makers. They are thus below both averages also with respect to contract trading fees. Very competitive indeed! Here's a full overview of the futures fees charged by BIT and how they are reduced as your trading volume reaches certain levels:
BIT Exchange Withdrawal fees
BIT Exchange charges a withdrawal fee of 0.0005 BTC per BTC-withdrawal. Once more, this fee is below the global industry average. The current global industry average is 0.000643 BTC per BTC-withdrawal according to this report, so BIT Exchange's BTC-withdrawal fee is quite competitive.
In addition to depositing cryptocurrency to the platform, BIT Exchange also lets you deposit fiat currency. Both through wire transfer and credit or debit card purchases This makes BIT Exchange an easy place to start trading at for the new cryptocurrency traders out there - a so called "entry-level exchange".