A Beginner’s Guide to Bitfinex
Some trading platforms are just better than average. Bitfinex is undoubtedly one of the best exchanges available to retail traders due to its advanced functions. This is the reason why all beginners should at least consider trying it as they explore all the available options on the market.
A Brief History of the Exchange
iFinex Inc., a company registered in the British Virgin Islands, owns Bitfinex. Source of image: Twitter.
Bitfinex was founded in 2012 as a Bitcoin (BTC) trading exchange. iFinex Inc., a company registered in the British Virgin Islands and headquartered in Hong Kong, owns the platform. It has been the largest marketplace for Bitcoin transactions since 2014, accounting for 10% of all trading. Even though Bitfinex can be considered as a success story, it is relevant to mention that the organization encountered some troubles along the way. First, 1,500 BTC were stolen in May 2015, and then, hackers were able to drain $72,000,000 in bitcoin from users’ accounts in June 2016. Nonetheless, the team behind the companywas able to pay back all lost funds to their customers. To do so, Bitfinex created BFX tokens, which were valued at $1. All users received the equivalent of their loss in BFX tokens. The company declared in April 2017 that they had bought back all of these coins, meaning that customers recovered their money. According to CoinMarketCap, the exchange now lists over 100 different pairs.
Advantages of Bitfinex Over Other Platforms
When compared to competitors, Bitfinex offers many advantages. First, it is now very secure because many extra features were added after it was hacked. The platform is also pretty cheap to use: the maker fee ranges from 0.1% to 0% and the taker fee ranges from 0.2% to 0.1%. Thus, there are many coins that can be purchased and traded on the exchange. Although platforms such as Binance offer more pairs, Bitfinex has a wider range of trading options. Its order book is more user-friendly and the order types unlock many possibilities. Finally, Bitfinex allows users to short cryptocurrencies whereas many other major exchanges do not provide this option. If you want to learn more about this platform, we suggest reading a detailed Bitfinex review first.
Features Available on Bitfinex
Although it might look confusing at first glance, the platform offers a wide variety of functions to its users. Among other things, it has many different order types, such as Limit, Market, Stop, Trailing Stop, Fill or Kill, One Cancels Other (OCO), Post Only, Hidden Order, Iceberg, and TWAP. The OCO is a big plus because as soon as one condition is met, the other order is canceled. In other words, it allows the traders to set a profit target and a stop loss at the same time.
Users can access Bitfinexthrough a mobile app and a web interface. Traders can count on TradingView’s charts, which includes most basic technical analysis tools. Moreover, it is possible to customize the way trading information is displayed,and among other things, users can change how they wish to see the order book, which is one of the most sophisticated in the industry. For instance, they can zoom in and out on the book-depth visualization according to their preferences. In a fast-paced environment, this is very useful because it is easier to seetheprice levelsfor large bids and offers.
Margin trading is one of the reasons why Bitfinexis very popular. As you probably already know, some traders make money when the market is falling. Indeed, short sellers choose to trade on this exchange to profit from the bear market that has affected all digital currencies since January 2018. Bitfinex provides a 3.33:1 margin, but liquidates a position as soon the net value of the account goes below15% of theborrowed funding value.
Bitfinex has been part of the crypto-ecosystem forseven years and is probably here to stay. Although the company does not accept American customers on its platform, Bitfinex has builtits credibility worldwideby getting involved in many projects that put the company at the forefront of innovation. For example, the team behind the project recently launched Ethfinex, a decentralized trading exchange powered by the Ethereum network focusing on ERC-20 tokens. Developers are also currently working on a similar platform built on the EOS blockchain named Eosfinex. As a phoenix rising from the ashes, Bitfinex was able to overcome the crippling hacking experience of 2016 and has now become one of the top virtual currency exchanges.
Image Credits: Bitfinex from DedMityay /Shutterstock