BitMEX just posted yet more unscheduled maintenance as Bitcoin attempted a run for $9,900. Events like these are slowly chipping away at the platform’s market share.
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BitMEX’s infamous unscheduled maintenance is back, and the exchange faces additional obstacles in the form of a lawsuit. With competitors creeping up on the exchange’s market share, it can no longer afford to inconvenience customers.
Trouble at Bitcoin’s Largest Derivatives Exchange
BitMEX has found itself in yet another bind after being forced down for unscheduled maintenance. The exchange has notoriously been overwhelmed on volatile days.
On March 13, the exchange went offline for around half an hour during a burst of volatility. In comparison, BTC’s volatility today was trivial.
In recent months, BitMEX lost nearly half of its market share as competing exchange gain ground. If this trend of overloaded trade engines and going offline for unscheduled maintenance continues, the platform could see itself slip in the rankings as traders move to other platforms.
All exchanges go down for maintenance, but most of them announce it beforehand so traders are prepared. Unscheduled downtime is a major inconvenience for traders as they cannot alter their positions. This is especially pronounced for an exchange like BitMEX that facilitates billions of dollars of trading volume a day.
After the flash crash in March, many traders left the exchange for good as the exchange saw BTC in its custody fall by over 25%.
Despite this, the exchange remains the most liquid venue for trading Bitcoin perpetual contracts—for now.
Adding to the exchange’s woes, a lawsuit accusing BitMEX of racketeering and market manipulation is doing the rounds in the media. The company that initiated the suit against the exchange’s parent company, HDR Global, has previously filed lawsuits against Ripple and FTX, wrote Coindesk.
#Bitmex faces lawsuit because of possible racketeering, money laundering, wire fraud, and operating an unlicensed money transfer business.
“It just costs more to bribe them.” – Defendant Arthur Hayes (about U.S. authorities).
— Cryptonator1337 (@cryptonator1337) May 18, 2020
With legal and technical obstructions for BitMEX, the reign of the top Bitcoin derivatives exchange may soon come to an end.