A crypto guide must provide reviews of all of the exchanges out there, so that you can find the right one for you. This review of Phemex consists of four parts: general info, fees, deposit methods and security.
Phemex is an exchange from Singapore that launched on 25 November 2019. It focuses on crypto spot trading and derivatives and supports eight different languages: English, Russian, Spanish, Japanese, French, Chinese, German and Korean.
An exchange's trading volume is very important for its users. A large trading volume often (but not always) correlate with deep liquidity. When the liquidity at a platform is deep, it means that it will be less difficult for you to find a buyer to your sell order, or a seller to your purchase order. On the date of first writing this review (21 April 2020, right in the middle of the finanial crisis caused by COVID-19), Phemex had a 24 hour trading volume of USD 405.6 million according to Coinmarketcap. This gave it place no. 50 on Coinmarketcap's list of exchanges in the world based on reported 24 hour trading volume. On the date of last updating this review (5 February 2021), Phemex's 24 hour trading volume had increased to USD 912 million! This placed it on place no. 11 among all crypto derivatives exchanges in terms of trading volume.
How come Phemex has become so popular then? Well, we guess you'll have to see for yourself. There could be numerous different reasons. On its own website however, Phemex presents a nice overview of its own platform compared to its two main competitors: BitMEX and Bitfinex. This is the overview:
We'll let you draw your own conclusions based on the above.
Gold/USD Trading Pair
As of 30 March 2020, you can also trade Gold/USD at Phemex. This could be a helpful trading pair to have access to, especially in times of high volatility. You can trade Gold/USD with up to 100x leverage.
As is customary for newer exchanges, Phemex also offers different bonuses to attract customers. As a welcome bonus, Phemex offers you up to $60 for any deposit of 0.2 BTC or more. This bonus can also be claimed by depositing other cryptocurrencies. In addition Phemex also offers you a $10 spot trading bonus for a single order worth 500 USDT and a $10 contract trading bonus for a single BTC/USD transaction worth 5000 USD. In total, you can receive up $80 dollars in bonuses. Please note that these bonuses may change at any time.
For its crypto derivatives products, Phemex 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 100x leverage on this platform.
Leveraged trades are risky though. For instance, let’s say that you have 100 USD in your trading account and you bet this amount on BTC going long (i.e., going up in value). If BTC then increases in value with 10%, you would have earned 10 USD. If you had used 100x leverage, your initial 100 USD position becomes a 10,000 USD position so you instead earn an extra 1,000 USD (990 USD more than if you had not leveraged your deal). However, the more leverage you use, the smaller the distance to your liquidation price becomes. This means that if the price of BTC moves in the opposite direction (goes down for this example), then it only needs to go down a very small percentage for you to lose the entire 100 USD you started with. Again, the more leverage you use, the smaller the opposite price movement needs to be for you to lose your investment. So, as you might imagine, the balance between risk and reward in leveraged deals is quite fine-tuned (there are no risk free profits).
On 15 May 2020, Phemex released its Spot Trading services. Currently, you can trade 11 cryptocurrencies against USDT: BTC, ETH, XRP, LINK, XTZ, LTC, ADA. TRX, ONT, BCH, and NEO, with more being added almost every week. Unlike contract trading, where you speculate and bet on the price of any specific crypto or asset without having to hold the asset itself, spot trading is the direct buying and selling of the cryptocurrencies listed above.
Something notable about Phemex’s spot trading services is that they offer a zero-fee model. On most exchanges, when you buy or sell a cryptocurrency, you must pay a fee that normally ranges between 0.10 – 0.25%. On Phemex, you can purchase a Premium Membership that can cost as low as USD 5.80 per month. The Premium Membership does, according to Phemex, offer significant savings to high volume traders.
This platform is not only available for desktop, but also Android and Apple mobile phones. Most traders in the crypto world today carry out their trades via desktop (around 70% or so). However, there are naturally people out there that want to do it from their smart phone as well. If you’re one of those people, then this platform can still be for you, seeing as it has a native mobile application (unlike e.g. BitMEX).
Phemex Trading View
Different exchanges have different trading views. And there is no “this overview is the best”-view. You should determine which trading view is best suited for you. However, all trading pages have certain similarities: they all show an order book or at least part of the order book, a price chart for any target crypto, and its order history. These will normally also display buy and sell-boxes. Before you choose an exchange, try to have a look at the trading view so that you can see that it feels right to you. This is the trading view at Phemex:
Phemex Trading fees
As we mentioned above, in terms of Spot Trading, Phemex has adopted a zero trading fee model. Instead they just charge for monthly Premium Memberships (prices are $9.99 for 30 Days, $19.99 for 90 Days and $69.99 USDT for 365 Days). Becoming a premium member will also allow you to set conditional spot orders, you will enjoy hourly withdrawals with no limits, and will be able to gift trial premium memberships to friends.
With respect to contract trading, Phemex separates between "takers" and "makers". Let's describe these terms real quick. Every trade occurs between two parties: the maker, whose order exists on the order book prior to the trade, and the taker, who places the order that matches (or “takes”) the maker’s order. We call makers for “makers” as their orders make the liquidity in a market. Takers are the ones who “take” this liquidity by matching makers’ orders with their own.
At Phemex, takers are charged 0.075% per order. This is a fair fee. Sure, there are exchanges offering even lower taker fees for contract trading, but there are also many exchange charging much higher fees.
When it comes to the makers, their fee is -0.025%. This essentially means that each maker gets paid to trade. To clarify, let’s say that you are the maker in an order where you purchase a derivatives contract for USD 1,000. This means that instead of paying USD 1,000, you will only have to pay USD 997.50. This is very competitive indeed.
Phemex Withdrawal fees
To our understanding, Phemex does not charge any fees of their own when you withdraw crypto from your account at the platform. Accordingly, the only fee you have to think about when withdrawing are the network fees. The network fees are fees paid to the miners of the relevant crypto/blockchain, and not fees paid to the exchange itself. Network fees vary from day to day depending on the network pressure.
Generally speaking, to only have to pay the network fees should be considered as below global industry average when it comes to fee levels for crypto withdrawals.
Deposit Methods and US-investors
Phemex previously didn't accept any other deposit method than cryptos, so new investors were restricted from trading here. Starting 18 June 2020, however, they partnered with a company called Banxa which is a payment gateway that accepts credit and debit card purchases of crypto.
Since then, Phemex has also partnered with Koinal, Coinify, MoonPay, and Mercuryo. You have a variety of payment options (ranging from bank transfers to Apple Pay) and rates to fit your needs.
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.
Phemex does not allow US-investors on its exchange. So if you’re from the US and would like to engage in crypto trading, you will have to look elsewhere. Luckily for you, if you go to the Exchange List and use our Exchange Filters, you can sort the exchanges based on whether or not they accept US-investors.