The following is a comparison review of some of the two most popular exchanges, that is; Bybit vs Deribit. Both of these exchanges are known for their high leverage trading. For more information about cryptocurrency trading platforms with leverage, make sure to visit our article where we list some of the best ones.
What is Bybit?
Bybit is a young cryptocurrency exchange platform that specializes in derivatives. It was registered in the British Virgin Islands in 2018. The platform offers Bitcoin, Ripple, Ethereum and EOS trading against the US dollar.
Bybit is different from other cryptocurrency exchanges in various aspects. One, it focuses on perpetual contracts and leveraged trading. As a result, traders can both long and short different cryptocurrencies and thus multiply their exposure to the market.
It offers its services to clients to all major countries in the world. However, the U.S. and Singapore, (where the company’s headquarters are based), are conspicuously missing from this list.
Although many exchanges offer margin trading, Bybit stands out by offering up to 100x leverage. The company has grown dramatically since its launch in March 2018. As of June 2019, the company passed the $2 billion mark in daily trading volume according to an official tweet. This growth has made it possible for the exchange to compete with more established firms such as BitMex, Okex and Deribit.
What is Deribit?
Deribit is a contract for difference (CFD) trading site – meaning that no actual purchasing of cryptocurrencies takes place on the platform. It was founded in March 2015 by John Jansen. Nevertheless, it did not start operations until two years later in June 2016. The company is based in the Netherlands and serves clients all over the world where cryptocurrency is considered legal.
Deribit does not share its daily trading volumes with the public. Notwithstanding, Deribit has been the object of criticism by industry experts and even clients citing issues with low liquidity.
One of the possible reasons for Deribit’s relatively small user base and volume is its policy not to accept any other deposits besides Bitcoins. Furthermore, you can only trade with Bitcoins on the platform.
Lastly, the site has its own dummy currency known as Dericoin that you can use to get acquainted with the platform.
Bybit vs Deribit: Pros and Cons
|Offer up to 100x leverage||Offers up to 100X leverage|
|Supports multiple cryptocurrencies||Allows anonymous accounts|
|Low fees||Low fees|
|Solid security||Fast account creation and trading|
|Robust customer support service||High security|
|Easy to make orders||A test platform for getting acquainted with the site|
|No identification/KYC needed||Transactions are insured|
|Does not serve U.S. citizens||Only accepts Bitcoin|
|Does not allow fiat deposits and withdrawals||The platform is not user-friendly|
|Relatively new with no real track record||Suffers from liquidity issues|
|Limited currency pairs|
Bybit vs Deribit: Website features
The Bybit platform emphasizes on speed. The system can process over 100,000 transactions every second for every trading pair listed on the exchange. As a result, it is fast, easy and accurate for users to place trades. Moreover, the site’s security has remained impenetrable since its inception in March 2018.
A couple of years ago, perpetual futures were a new concept, but not anymore. As the name suggests, these trades have no expiry date and can “rollover” perpetually. BitMex is one of the best-known sites offering perpetual contracts and sites such as Bybit have made the idea go mainstream. Bybit offers its perpetual contracts with up to 100x leverage.
Another unique aspect of this exchange is the fact that they do not enforce a know your customer (KYC) policy upon registration. This means that you do not need to verify your identity before you can use the platform. All you need is an email address or phone number and you will be able to trade as much as you wish.
Deribit can be described as a Bitcoin trading platform that offers futures and options trading. The exchange specializes in offering leveraged trades at up to 10X the value. Interestingly, Bitcoin futures can be traded with up to 100x leverage. Deribit also allows margin trading.
The platform utilizes a web-based trading system whose user interface has improved over time, making it more friendly and instinctual. Common features such as trading history, order book and recent trades are easy to access. You will also have direct access to various charts, indices and technical analysis indicators.
Deribit allows users to trade either via their web interface, through mobile (android/iOS) or using an API that can integrate with other software. The company stores 95% of their funds in cold storage.
Getting started with Bybit
When signing up on Bybit, you can use either your phone number or your email address. After adding and confirming a password, a verification code will be sent to your email or phone via SMS for account verification. Once you have verified your account, you can start trading immediately.
Bybit deals with cryptocurrency alone, meaning there are no options for trading fiat currencies like U.S. Dollars or Sterling Pounds. As a result, users do not have to verify their identities before they can deposit or withdraw funds in their wallets.
To deposit funds to your Bybit account, click on the “My Assets” button and you will see all the various coins you can deposit to your account. Under “My Assets” tab, click on the “deposit” link that is next to the asset you want to deposit. At this point, your unique address will be automatically generated where you can send BTC, EOS, ETH and XRP. There is no minimum amount you can deposit with the exchange.
Once the setup is done and your email is verified, you are liable to withdraw funds from your account. Just go to “My Assets” and click on “withdraw” next to the wallet you want to withdraw money from.
The minimum withdrawal amount depends on the specific coin and is generally equal to two times the average mining fee in the network. Withdrawals can be made three times a day – at midnight, at 8:00 a.m. and at 4:00 p.m.
Getting started with Deribit
Signing up for Deribit is as easy as 1,2,3. All you must do is fill a form with four fields: email, username and your password twice then click on the submit button. A confirmation email will be sent to your email address. Click on the verifying link and you are in!
Deribit does not allow logging in using social media sites. Also, the site recommends that you set up two-factor authentication (2FA) for better security,
Types of Deribit accounts
Once you sign up to Deribit, you will enjoy all the benefits whether your account is verified or not. If necessary, you can opt for a second type of dummy account that uses Dericoin to simulate trading and to get new users acquainted with the website. The demo platform is crucial for newbies who want to understand how the system works before moving to real trading.
Since Deribit trades with Bitcoins only, it is easy to use to keep one’s identity anonymous on the platform. The site may blacklist some temporary email services, but verification is completely optional. Nonetheless, the site can still impose limits on any account and request for identity information whenever they like according to their terms and conditions. As mentioned earlier, all U.S. citizens are prohibited from opening any Deribit account.
Deribit deposits are limited to Bitcoin. To deposit, you will have to generate a new address or use an existing one and send your Bitcoins to that address. Just click the “Deposit tab” which will redirect you to the deposit page. If it is your first time, you will get a notification to generate a new wallet address where your funds will be kept. You will get a warning that you cannot transfer less than 0.001 BTC and you will not be charged any fees.
Again, withdrawing funds is easy on Deribit. Just click the “Withdraw tab” which will redirect you to a withdrawal page where you can fill in your Bitcoin wallet address, see the available BTC balance, amount to be withdrawn and the fees involved.
Bybit vs Deribit: Fees
The Bybit exchange charges several fees. These include:
Position funding fee:
This fee is exchanged between buyers and sellers on the platform. It indicates the amount of margin held by the system to pay for the next funding. The position fee is updated every 8 hours and calculated using the following formulae:
- Short position fees = Entry price x Funding rate
- Long position fees = Bankruptcy price x Funding rate
Rewards makers with a 0.025% rebate for adding to the liquidity while takers are charged a 0.075% fee.
Bybit charges a withdrawal fee of 0.0005BTC on withdrawal transactions.
Charges for trading on Deribit depend on the type of transaction or trade. For instance,
- Have 0.04% or 0.0004BTC contract fee
Option fees are effectively capped at 12.5% of their value – meaning they cannot exceed this point no matter the market conditions.
Furthermore, options liquidation trades are charged a 0.19% of the underlying options contract.
Have a differentiated commission depending on the position taken by the user. That is:
- Makers are rewarded a 0.02% rebate for contributing with liquidity
- Takers get a 0.05% fee for reducing liquidity
- Futures liquidations fees – 0.35%
- Maker Rebate: 0.025%
- Taker Fee: 0.075%
- Perpetual contracts liquidations fees -0.375%
Deribit fees are normally charged according to the speed of the withdrawal process, the faster the process, the higher the fees. The fees normally range between 0.0002 and 0.0015 BTC per withdrawal transaction.
Bybit vs Deribit: Security
Allows users to use two-factor authentication using both email and SMS to further secure users’ accounts. Any user activity is logged and can be reviewed from the account. It is wise to check your account regularly to be able to spot any unauthorized access.
Bybit stores over 95% of their clients’ funds in a cold wallet system. Consequently, collection and withdrawal of all digital assets can only be done via offline signatures. Furthermore, users can withdraw from the platform only 3 times a day.
The system also logs all user activity including; deposit records, transaction history, account balances, etc. To mitigate losses on contracts due to extreme market conditions, the exchange uses an Insurance Fund.
Bybit guarantees its users that none of their personal and account data will ever be compromised due to any error in the system. If it should so happen, they promise to bear the full cost of such a mishap.
Deribit utilizes cold storage to secure their clients’ funds with around 95% of the total funds stored this way. This security feature protects from hacking attempts and other issues such as the liquidation algorithm bug that caused a loss of more than $200,000 in September 2017. However, they slow down the withdrawal process.
The service makes use of two-factor authentication to further secure users’ accounts. This feature is not available by default and you will have to set it up yourself after signing up.
Moreover, the site uses IP pinning technology to recognize any changes in IP address. The session is terminated in case of a change in IP. By default, one session timeout is set as one week but it can be adjusted to as low as an hour.
Ease of use – Bybit vs Deribit
When designing any online trading platform, it is crucial to think about its new users. New clients should find all the features intuitive and easy to grasp. This way, they can put more focus on trading and maximizing their chances of making profits. Using Bybit vs Deribit will give you a completely different user experience.
Bybit offers a more standard trading user interface. If you have ever used BitMex before, then you will have an easy time with Bybit. Being a leveraged trading platform, Bybit is not necessarily designed for beginners in crypto trading. Nonetheless, the user interface is simple enough for anyone to grasp quickly.
One thing that will strike you after visiting the Deribit exchange is its unintuitive design which may give new users a bit of a headache. Their site is quite cluttered compared to other minimalistic sites that only show necessary information per webpage.
As a result, new users may be forced to spend a considerable amount of time before they can understand how the site works.
To wrap up, Bybit and Deribit are both great exchanges. However, after an extremely short period, Bybit has been able to evolve into a fully functional cryptocurrency exchange with enough liquidity to go against more established competitors such as Deribit. Depending on the features you are looking for in an exchange platform, we hope this Bybit vs Deribit comparison review helps to make your choice easier.