BitMEX Shutdown Marks Shift in Crypto Exchange Failures

BitMEX, once a prominent player in the cryptocurrency market, announced it would shut down on September 23rd. The exchange told its customers to close their positions and withdraw their funds before then, but this move comes without any major financial concerns. Unlike previous high-profile collapses like FTX, BitMEX's shutdown is not due to a balance-sheet hole or withdrawal freeze.

The exchange's market share has dwindled to below 0.01%, with daily volumes near $400,000, according to Kaiko data. This decline in relevance makes BitMEX's exit a relatively smooth one, as traders have migrated to more liquid exchanges elsewhere.

This development is noteworthy because it marks a shift in the way crypto exchanges fail. In 2022, collapses like FTX and BlockFi were characterized by hidden leverage, credit exposure, and customer-asset misuse, which had far-reaching consequences for the market. BitMEX's closure, on the other hand, is more of an 'ordinary business' event.