BitMEX CEO Stephan Lutz expresses pride in the widespread adoption of the exchange’s groundbreaking perpetual swap, even by its competitors.
The phrase “Good artists copy, great artists steal,” famously attributed to Steve Jobs, is one that Lutz embraces as the CEO of BitMEX. Jobs used the saying to explain how Apple built upon and improved ideas from others. In the same spirit, Lutz is not concerned with competitors replicating the perpetual swap, the innovative financial tool that BitMEX created to power the crypto derivatives market. In fact, he views the adoption of the perpetual swap by other exchanges as a sign of its success, and believes the more traders use it, the better it is for the entire market.
“It was copied by everyone, because it’s open-source know-how,” Lutz told CoinDesk in an interview. “The whole world works on it, and that’s the best form of flattery we could ask for.”
Unlike traditional futures contracts, which settle at a specific price on a set date, perpetual swaps allow for continuous trading without an expiration date. They work similarly to margin trading, where long and short positions exchange payments (the funding rate) to keep prices in sync with the underlying asset. This unique feature has allowed perpetual swaps to become a mainstay in crypto trading.
Lutz believes the perpetual swap was a game-changer for crypto trading, addressing key issues that early market participants faced. “In the early days of crypto, there was a lot of counterparty risk, and no real framework for connecting long and short positions,” he explained. “The perpetual swap, with its funding mechanism and insurance fund, helped build the foundation for the entire crypto futures market.”
The swap also enables traders to react with the speed necessary in the crypto market. Lutz, who previously worked at Deutsche Börse, explains the rapid pace of the crypto world compared to traditional finance.
“If traditional finance operates on a seven-year cycle, in crypto, that cycle is closer to six months,” Lutz said. “Being able to react quickly to new developments is crucial.”
Though BitMEX is no longer the largest derivatives exchange by volume—centralized exchanges like Binance have adopted the perpetual swap and surpassed it—the platform still maintains a dedicated user base. One reason for this is that BitMEX does not operate its own market-making desk, meaning it doesn’t trade against its own customers.
“Our funding rates may differ at times, but that’s because we ensure completely independent price discovery,” said Lutz. “We’re committed to maintaining fairness and neutrality.”
During periods of high volatility, particularly during market declines, BitMEX often sees a surge in market share, as loyal traders return to the platform for its transparent and reliable service.
Looking forward, Lutz envisions BitMEX continuing to dominate in the Bitcoin derivatives space while selectively expanding its offerings. As the exchange celebrates the continued success of its perpetual swap, Lutz is confident that BitMEX will remain an innovator in the crypto space, ready to inspire the industry once again.
