Established in 2016, Deribit is an online trading platform that exclusively focuses on Bitcoin futures and options. The platform derives its name, “Deribit,” from a combination of “Deri for Derivatives” and “Bit for Bitcoin.” John Jansen founded this corporation, with its main office located in the Netherlands at Stationsstraat 2b, 3851 Ermelo. Deribit caters to a global audience of traders, offering product options with leverage up to 1:20 and competitive spreads.
Futures Trading
Deribit’s futures contracts commence at $10, featuring a default leverage of 1:10, extendable to 1:20. The mid-market price, calculated from the Deribit index based on the average prices of five major exchanges, adds depth to the trading environment. The expiration price, derived from the average Deribit index prices every 6 seconds starting 30 minutes before the trading day settlement, introduces a dynamic element to trading strategies.
Executing market orders involves outbidding the order book, with an option to select “post only” to minimize fees by preventing immediate matching. Once placed, orders transition to open orders or positions, enabling users to manage and edit them under the open order tab. It’s worth noting that the platform currently lacks trade safeguards such as stop loss and take profit under the open order page, necessitating users to handle these aspects through the trade slip.
Options Trading
In the realm of Bitcoin options, Deribit stands out as a global platform offering this service. Despite the market’s relatively small size, it offers opportunities for those who are interested in Bitcoin speculative trading. Account creation entails an initial margin of 10%, with users required to maintain a 3% margin on their positions. Automatic liquidation is triggered if the margin falls below the maintenance margin, emphasizing risk management.
The platform’s user-friendly interface facilitates seamless navigation between futures and options trading, providing traders with a comprehensive suite of tools for effective decision-making. Additionally, Deribit’s commitment to education is evident through its educational resources, which cater to both novice and experienced traders, fostering a supportive learning environment.
Deposit and Withdrawal Procedures
Deribit exclusively accepts Bitcoin for deposits and withdrawals. Depositing BTC involves logging in and obtaining the deposit address or scanning the QR code. To ensure precision, a minimum deposit of 0.001 BTC is recommended. Withdrawals mirror the deposit process, with users logging in, selecting Withdrawal, and specifying the destination wallet address. The system automatically calculates fees based on priority levels chosen by users.
Deribit goes the extra mile to ensure user security during deposit and withdrawal transactions. Two-factor authentication (2FA) is strongly recommended for an added layer of protection, enhancing the overall safety of user funds.
Fees and Charges
Deribit imposes a $10 futures contract price along with 0.02% maker and 0.05% taker fees. Option trading incurs a 0.04% fee per contract for both makers and takers. Additional fees encompass:
Settlement (Deliveries)
0.025% for futures
0.02% for options
For options, fees never exceed 20% of the option’s value. Liquidation fees stand at 0.15% for futures trades, with 0.1% contributing to the insurance fund, and 0.1% for the underlying option contracts.
Deribit’s transparent fee structure and commitment to competitive pricing contribute to its attractiveness for both institutional and retail traders. Regular updates on fee changes and a clear breakdown of charges ensure users have a comprehensive understanding of the cost implications associated with their trades.
Privacy and Security
Deribit distinguishes itself by not mandating user registration or verification for transactions. Registration suffices for account creation, allowing immediate BTC deposits and trades. The platform’s exclusive focus on Bitcoin transactions justifies its decision to omit verification. Security measures include storing 90% of Bitcoins in secure cold storage.
In addition to its privacy-focused approach, Deribit actively engages in ongoing security assessments and employs industry-standard encryption protocols to safeguard user information and assets. Regular security audits and updates ensure the platform remains resilient against emerging threats in the dynamic cryptocurrency landscape.
Customer Support
Deribit supports users through a comprehensive Frequently Asked Questions (FAQ) section accessible within the trading platform. Direct assistance can be obtained via email or live chat, enhancing user support options.
Deribit places a strong emphasis on customer support, recognizing the importance of timely and effective assistance for traders navigating the complexities of the cryptocurrency market. The support team is responsive to user queries, providing guidance on various aspects, including platform features, trading strategies, and technical issues.
- Allows trading in both futures and options
- Streamlined account creation process
- Provides fund insurance protection
- Reasonable fee structure
- Lacks support for altcoins
- Not beginner-friendly
Conclusion
Deribit’s appeal stems from its specialization in trading Bitcoin derivatives rather than physical assets. This unique focus presents diverse opportunities for those interested in speculative trading with Bitcoin. While the concept of Bitcoin derivatives trading is in its nascent stages, Deribit is poised to emerge as a market leader should the trend gain momentum. The platform’s commitment to user-friendly features, security, and ongoing support positions it as a reliable choice for traders seeking a dedicated and robust Bitcoin trading experience.
