BitMEX helped create the anything-goes culture that defined early crypto trading. It operated offshore, offered extreme leverage, made perpetual futures a staple, and championed the idea that markets should never close. But bigger competitors passed it long ago, and it never recovered after regulators began cracking down in 2020.
The ideas BitMEX made popular are showing up across finance. Crypto exchanges are moving into stocks and tokenized shares. Traditional exchanges are extending their hours and introducing products that would have seemed out of place on a regulated venue only a few years ago. The two sides are increasingly imitating each other.
Ayesha Kiani, COO of Monarq Asset Management, said, "BitMEX shutting down feels much bigger symbolically than it does economically." She added, "In many ways, BitMEX became a victim of its own success."
The exchange's decline and closure are a reminder of how fast crypto's center of gravity shifted. What began as a small offshore venue for risk-taking became a template for the wider market, but also lost ground as regulation and competition changed the industry. The model it created no longer needed BitMEX to survive.
The borrowing is not one-way. CME Group Inc. expanded its crypto futures and options trading this year to around the clock, with only a weekly maintenance break. CME reported that notional volume in its crypto derivatives hit a record $3 trillion last year.
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The shift is a sharp reversal. Crypto originally positioned itself as the opposite of the financial establishment - faster, global and never closing. Wall Street often dismissed the sector as excessive speculation. Now those lines are blurring, and what once divided the industries no longer separates them so clearly.
One measure is the rise of perpetual futures. Kraken began offering stock-linked perpetual contracts with up to 20 times leverage earlier this year. Coinbase Global Inc. launched dividend-paying tokenized stocks in June, and it also let eligible customers outside the US trade perpetual contracts on US equities around the clock.
The New York Stock Exchange is developing a blockchain-based venue for tokenized stocks and ETFs to trade continuously. Its parent, Intercontinental Exchange Inc., has also taken a stake in crypto exchange OKX.
The economics help explain the moves. The heavy futures volume gives platforms a reason to keep broadening what they offer.
Crypto volumes can be volatile, and most activity is clustered on just a few exchanges, so platforms want more ways to keep customers active. The challenge from established finance is also growing. Established firms are pushing into similar services with larger customer bases, which encourages crypto exchanges to become broader platforms rather than pure speculation venues, according to Robot Ventures managing partner Tarun Chitra.
"You need to also offer more than what you needed three to five years ago," Chitra said. "Otherwise you'll have user retention issues."
Market share is already concentrated. Kaiko tracks 44 exchanges; the six biggest handle over 60% of volume, and Binance has close to 37% by itself.
The competitive picture is intensifying, according to Rob Hadick, a general partner at venture fund Dragonfly. "The future is clear, regulated US perps are coming to the market and global perps liquidity will continue to grow," he said.
"Competition is getting fiercer and the markets are becoming more global," Hadick said. "Especially in crypto, where assets are fungible across geographies, and now in the globalization of equities through tokenization, I'd expect exchanges to focus on gaining the best moat there is, scale and liquidity."
BitMEX's influence will outlast the company. Instead of crypto displacing Wall Street, traditional finance absorbed much of crypto's model, leaving the two industries looking nearly identical. The offshore exchange that once represented crypto's rebel spirit is shutting down, but the model it helped build is becoming mainstream.
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