Introduction

Bybit is a relatively new cryptocurrency derivatives (up to 100x leverage) exchange founded in March of 2018. Bybit is legally structured in the British Virgin Islands, with their headquarters based in Singapore, a well known fintech friendly capital. That said, most new exchanges suffer from liquidity issues but Bybit has been making leaps and bounds in user signups since they launched in April 2019. They’ve been really on a roll.

Trading on Bybit allows you to leverage trade (margin trade) cryptocurrency derivatives, just like BitMEX and PrimeXBT. On Bybit, you can trade Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), and EOS against the US Dollar (USD).

Join Bybit today and receive up to $90 of free credit!

On Bybit you can trade 1x (no leverage) or as high as 100x (100 times your trade value). Leverage is complex and dangerous, as you can get liquidated of all your currency if your leverage is too high. Always keep an eye on your Liquidation Price when using leverage! Leverage is powerful, it allows you to bet with a much larger crypto stack than you actually have. Used properly is can be very rewarding. Of course, in order to use leverage you must incur fees.

Traders on Bybit can take both short and long positions to make money whichever way the market moves. Taking a long position means buying the asset and essentially making a bet that it goes up. Similarly taking a short position means selling the asset and essentially making a bet that it goes down in value.

Inexperienced traders should be very cautious and start with small positions or simulated trading (also known as paper trading). Never risk more than you can afford to lose. If you are interested in learning more about trading, join us on the To The Moon Telegram Group. We look forward to seeing you there!

User Interface and Experience (UI/UX)

Bybit’s user interface looks gorgeous and is very easy to use. I personally really love using the dark mode and I think the overall user experience is far superior to BitMEX.

What I love most about using Bybit is the fact that they show your Unrealized P&L (Profit & loss) and margin in both USD and Bitcoin— no need for sketchy tools like GreaseMonkey extensions anymore that people use with Bitmex.

Bybit also has a neat feature that allows you to set a stop loss, a take profit, and/or a trailing stop on your position. This can be done very easily by clicking the small pencil icon located underneath the ‘TP/SL (Trailing Stop)’ column of your open positions tab.

Clicking said pencil icon will present you the following menu. There you can set your take profit price, stop loss price, and a trailing stop amount. You will be shown your potential profits and losses once a value is entered as well! Very, very nice!

Another awesome feature that Bybit has enabled is currency swaps. By heading to the ‘Assets’ tab, you can find an ‘Asset Exchange’ button. This button allows you to easily swap between any of the assets offered on the platform. You can also swap to USDT as well! The only downside to this is that they charge a flat fee of 0.0005 BTC to make this exchange. At the time of writing, that is roughly $3.50 which can be a bit expensive if you’re swapping small amounts. If they could implement a more dynamic fee structure for smaller amounts, this would be a killer feature.

Fees

The fees are identical to Bitmex. If you always limit in and limit out, you can get paid to trade here. See below:

Takers (market order) pay 0.075% on each trade, Makers (limit order) receive 0.025% on each trade. For funding Bybit works the same as BitMEX. Funding occurs every 8 hours at 16:00 UTC, 00:00 UTC and 08:00 UTC. You will only pay / receive funding if you hold a position at one of these times.

Dual-price Mechanism.

The crypto-space has been constantly facing accusations of price manipulation, where exchanges have often resulted in intentionally deflating or inflating prices for malicious gains. To counter this, ByBit uses the dual-price mechanism to protect investors from manipulation and uses mark prace AND last traded price. For instance, if the price of ETH plummets from $180 to $40 as a result of attempted manipulation, the Mark Price will remain at $180, effectively protecting the traders from liquidation since the mark price is the sole trigger for liquidation.

Contract Loss Mechanism

With their contract loss mechanism, ByBit is able to determine who bears what cost when positions cannot be liquidated at bankruptcy. Unlike socialized loss systems where all profitable traders share the loss, ByBit uses the deleveraging system. Users are ranked according to profit ratio and effective leverage and the more profitable and higher leveraged traders(risky traders) are de-leveraged first.

The Competition: Bybit vs Bitmex

Below are some comparisons between Bybit and arguably the most popular and well known derivatives exchange, BitMEX. Personally, I have moved most of my funds to Bybit. Disclaimer, I still do a small amount of trading on BitMEX, though the majority is now done on Bybit. The information below just serves as a quick comparison of the two exchanges.

Available Trading Pairs

Bybit: BTC/USD, ETH/USD, EOS/USD, XRP/USD

Bitmex: BTC/USD, ETH/USD and futures ADA/BTC, BCH/BTC, EOS/BTC, ETH/BTC, LTC/BTC, TRX/BTC, XRP/BTC

While BitMEX uses inverse and quanto contracts to allow trading other pairs (such as ETHUSD and LTCBTC) using Bitcoin as margin, Bybit requires you to deposit and use the underlying currency for margin (Ethereum for ETH/USD pair, XRP for XRP/USD pair, etc.). That means you cannot use your Bitcoin to trade ETH/USD pair on Bybit.

Maximum Leverage and Risk Limit

Bybit: 100x leverage, risk limit 550 BTC

Bitmex: 200x, risk limit 1,100 BTC

24h Volume (estimated average)

Bybit: 2.5 Billion USD

Bitmex: 7.5 Billion USD

Despite the fact that Bybit is relatively new exchange, it has a significant amount of volume (even compared to BitMEX). The amount of liquidity on Bybit should be enough for users that trade with position size less than 5,000,000 USD.

Customer Support

Bybit has a live chat that operates 24/7 and is able to speak multiple languages. So far my experience with Bybit’s customer support has been excellent — they have always solved my problems / question about the platform quickly and professionally.

Trustworthiness

As trustworthiness is rather subjective, I will include their approximate Alexa rank and their security features. I’d also like to note that neither of them have ever been hacked.

Bybit: Alexa rank 16,000; 2-FA (Google Authenticator, SMS)

Bitmex: Alexa rank 14,00; 2-FA (Google Authenticator), 24-hour max login time

Trading engine

Bybit: 100,000 transactions per second

Bitmex: 500 transactions per second

The trading engine is the main reason I moved from Bitmex to Bybit. It truly is amazing! I have never had any problems with overloads, or stop losses not working, or getting a slippage on my market orders. On BitMEX this happened nearly every single time there was a significant move and I have lost a lot of money due to this. I can’t count how many times the order feature has been temporarily disabled.

Under load and in times of absolute volatility, Bybit didn’t skip a beat. Smooth as butter. And the reason is they actually spent a great deal of time and money on building a very powerful matching engine. According to Bybit they’ve tested up to 100,000 tps (transactions per second). This is quite remarkable and far superior their competition.

Pros

Trading Bonuses?! Bybit is running a promotion that gives you up to $90 in FREE margin as a trading bonus, simply by depositing and completing other menial tasks.

Bybit is running a promotion that gives you up to $90 in FREE margin as a trading bonus, simply by depositing and completing other menial tasks. Beautiful UI with an adjustable trading GUI. It’s Bitmex, without the system overload issues.

You can margin trade: BTC, ETH, XRP, and EOS in their respective coin.

A simple asset exchange to swap between various coins.

System encourages stop loss / take profit measures at the time of order.

Lightning fast trades — With their advanced matching engine they claim capabilities for 100k tps (transactions per second).

No overload issues or errors even under load.

Less flash crashes like you often see on Bitmex.

Same fees structure: Takers (market order) pay 0.075% on each trade, Makers (limit order) receive 0.025% on each trade.

Configurable GUI. Sections can be drag-and-dropped wherever you prefer them.

Bybit has a robust trading API.

Website works great on mobile.

Very limited KYC (and you know I love that!).

Cons

Needs more order book depth, I like to scroll out and see the orders accumulating far away from price.

Restricted for United States of America, Québec (Canada), and Singapore (psst… you should just buy a VPN).

Conclusion

Overall, I have to say I am really impressed with Bybit. Despite it’s extremely young age, it has already amassed a substantial amount of trading volume. Enough to make it serious competition for other exchanges. With fees comparable and even lower than that of some of it’s competitors and an absolutely stunning user interface, Bybit has set itself up for success. It has drawn me to it’s side.

If you’re into derivative trading or are interested in getting started, I very highly recommend giving Bybit a chance. You will not be disappointed, that I promise you. Also, sign up for our To The Moon Telegram Group for discussions about cryptocurrencies, stocks, trading, and making money in general!

DONT FORGET! Use our link to register at Bybit and receive up to $150 in BTC bonuses! https://tothemoon.blog/friends/bybit/

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Original post from my blog: https://tothemoon.blog/trading/bybit-review-my-new-preferred-cryptocurrency-derivatives-exchange/