Key Points:
- BitMEX expands into prediction markets, allowing crypto traders to speculate on real-world events.
- Three prediction contracts offer diverse opportunities, from cryptocurrency recovery rates to regulatory decisions.
- BitMEX’s move into prediction markets reflects a strategic shift towards historical event-based trading.
BitMEX, a renowned cryptocurrency exchange predominantly recognized for its derivatives trading, has embarked on an innovative journey into prediction markets. This recent addition to BitMEX’s repertoire allows traders to speculate on real-world events, ushering in a realm of possibilities for cryptocurrency enthusiasts and investors.
Furthermore, BitMEX’s venture into prediction markets signifies a significant expansion of its product offerings. Traders can now speculate on various real-life events spanning various industries and topics. This also includes predicting recovery rates for financially troubled cryptocurrency projects, the fates of their founders, and other intriguing scenarios, all with the profit potential.
As of September 13, BitMEX introduced three prediction contracts:
P_FTXZ26: A prediction contract on the recovery rate of customer claims from FTX, a prominent cryptocurrency exchange. The settlement date is set for December 25, 2026, at 20:00 UTC, and the contract’s outcome will be determined by the recovery rate of FTX’s customer claims.
P_XBTETFV23: A prediction contract speculating whether the U.S. Securities and Exchange Commission (SEC) will approve a Bitcoin Exchange-Traded Fund (ETF) by October 17, 2023. The settlement date for this contract is October 27, 2023, at 20:00 UTC.
P_SBFJAILZ26: A prediction contract focusing on whether Sam Bankman-Fried (SBF), the CEO of FTX, will be sentenced to jail in the United States District Court, Southern District of New York. The settlement date for this contract is December 25, 2026, at 20:00 UTC.
How BitMEX Prediction Markets Operate
BitMEX’s Prediction Markets function similarly to other futures contracts on the platform, with some key distinctions:
- Contract prices are denoted as “Last Price.”
- Leverage is not available.
- Margin and settlement transactions are conducted in Tether (USDT).
- Payouts are rated on a scale of 0 to 100, representing the likelihood of an event’s occurrence.
- Maker fees are set at 0.00%, while Taker fees stand at 0.25%.
- Early settlement is possible if the event transpires before the contract’s expiration.
- Availability may be subject to jurisdictional regulations.
Each contract holds a value between $0 and $1, but it is quoted in percentage terms. BitMEX thoroughly vets each listing to address the intricacies of defining specific outcomes. All contracts will use USDT as settlement, and the platform strives to provide a fair settlement price.
An Illustration of BitMEX Predictions in Action
To exemplify how BitMEX Predictions function, consider the fictional scenario of a trader participating in the P_FTXZ26 contract, predicting the recovery rate for FTX’s customer claims at $0.60 per USD. If the contract’s price at trading is $0.20, indicating a market prediction of $0.20 per USD, the trader may purchase 1000 contracts with a margin of 100% in USDT.
Upon contract expiry, suppose the settlement price is $0.30, 50% higher than the entry price. The trader’s payout would amount to $100 USDT, calculated as (Exit Price – Entry Price) * Multiplier * Number of contracts = ($0.30 – $0.20) * 0.01 * 1000.
BitMEX’s entrance into Prediction Markets reflects a strategic move highlighting a shift toward historical events. This expanded offering allows traders to engage in predictions related to real-world events and diversify their investment portfolios. It offers an avenue to generate additional income in a market characterized by low volatility.
Conclusion
BitMEX’s journey into Prediction Markets underscores its commitment to innovation and diversification. By leveraging their insights and knowledge, traders can predict real-world events and potentially profit in a secure and regulated environment. Furthermore, as the cryptocurrency landscape continues to evolve, BitMEX remains at the forefront, presenting exciting opportunities for its user base.
Personal Note From MEXC Team
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