Deribit

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Deribit

ISIN	🆔
Industry	Cryptocurrency Exchange
Founded 📆	June 2016
Founder 👔	John Jansen
Area served 🗺️
Products 📟	Bitcoin & Ethereum futures and options trading
Members
Number of employees
🌐 Website	www.deribit.com
📇 Address
📞 telephone

Deribit is a cryptocurrency derivatives exchange.

It operates an online platform for financial products, such as futures, options and perpetual swap contracts, which are settled in cryptocurrency (not physically settled or in fiat currency).

Deribit is based in The Netherlands. The company operates internationally, although there is a small number of restricted jurisdictions, like the US. From on February 10, 2020, the cryptocurrency derivatives exchange platform will no longer be operated by the Dutch company Deribit B.V., but by DRB Panama Inc., a 100% subsidiary of the Dutch entity.

History

Deribit founded by John Jansen, started with the ambition of creating the first cryptocurrency options exchange in the world. Even though it was a highly challenging task, in slightly more than two years, the team finished working on system development. In June of 2016, Deribit was officially launched. Deribit is a Dutch cryptocurrency futures and options exchange, with its headquarters located in Amsterdam. Deribit started as a fully dedicated BTC trading platform, however, since then, ETH contracts have been added, and more currency contracts will come. Currently, their customers can trade perpetual, futures, and options contracts. Furthermore, Deribit remains the leading exchange offering European style cash-settled crypto options and continues to set the standard for the rest of the industry.

John has a history in options trading. His first job was as an options market maker on the Amsterdam Stock Exchange. In 2012 he learned about BTC and realized that for the cryptocurrency market to grow into a mature market, a high-performing derivatives market is a necessity. In 2014, the idea of Deribit was born. Soon after that, he met Sebastian, the current CTO, and together they set about to build Deribit.

Events

August 2019, Deribit introduced block trading over Paradigm, an encrypted communications network. Minimum block sizes are 40 Bitcoin and 800 Ethereum. The company's chief operating officer. According to the company's website, the derivatives contracts pay-out in Bitcoin at the time weighted average of its BTC index.

On October 2019, the users of Deribit were startled by a sudden fall in prices of Bitcoin that was only detected on the Deribit platform. Deribit uses a price index for financial products, based on spot prices of eight exchanges, including those of Coinbase.

The API of Coinbase passed - through a bug - a spot price of $ 4,200. And because the Coinbase weighting in the index is around 18%, the price index of Deribit fell. This resulted in a decrease to $ 7,700 per Bitcoin.

In the meantime, Deribit has reimbursed all relevant accounts. A total of ~ 155 Bitcoin was reimbursed by Deribit. The loss is estimated at around $ 1.35 million, an amount paid from the cash reserves of the exchange.

Features

Deribit utilizes a web-based trading platform and incorporates an intuitive and relatively easy to use interface that also includes a wide range of functions. The platform includes futures, index, and volatility charts and a range of statistics, technical analysis indicators and key data related to futures and options trading. In addition, the platform uses a number of unique features:

Portfolio Margin
uses a risk-based model that determines margin requirements based on historical volatility by valuing a specific portfolio over a range of underlying price and volatility moves. This Portfolio Margin risk-based model takes into consideration positions in futures and options combined, which may help reduce the margin requirement of your portfolio. Portfolio Margin accounts offer these potential benefits to traders and market makers who maintain a balanced portfolio of hedged positions: Lower margin requirements & Increased leverage.

Incremental Liquidations also known as partial liquidation. The position of a user will be liquidated in fractional steps to avoid unnecessary reductions, on condition that partial liquidation ensures the margin balance is above the required maintenance margin level.

Technology

The exchange strives to be technologically advanced and allows users to trade via their trade matching engine with less than 1ms latency. Users can also trade via web interface, mobile (iOS/android) or API, and Deribit also integrates with trading technologies. In order to secure user funds, the platform makes use of cold storage for approximately 99% of their funds. The framework of the platform has been developed in Erlang to assure the ability to handle large numbers of requests with ultra-low latency (<1 ms). The matching engine has been developed by Deribit from scratch and all of their technology is proprietary.

Trading Options

Users can trade options, futures and perpetual swap contracts on the Deribit platform, using up to 100x leverage. Deribit claims to have the most liquid crypto options market globally. Weekly, monthly, quarterly and half-yearly options are available.
On the Deribit Testnet, it is possible to practice trading without risking real funds.

Deribit Insights

Deribit provides a weekly publication of in-depth cryptocurrency market research. Deribit Insights reviews crypto events, looks into current market developments and explores future advancements of the industry.

Deribit Education

Deribit offers an online free course covering the basics of derivatives trading to how the Deribit platform works. The course includes articles and videos on a variety of subjects. The goal of these educational lessons is to allow traders to understand the system and make the most of derivatives trading.

References

This article "Deribit" is from Wikipedia. The list of its authors can be seen in its historical and/or the page Edithistory:Deribit. Articles copied from Draft Namespace on Wikipedia could be seen on the Draft Namespace of Wikipedia and not main one.

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