Bybit Review: Latest Bybit Pros, Cons, and Key Features 2023

What Is Bybit?

Founded in 2018, Bybit is a rapidly expanding crypto derivatives exchange founded by a group of professionals with a background in investment banking and the forex industry. Headquartered in Singapore and registered in the British Virgin Islands, Bybit has a global vision and specializes in providing a fast, secure, and transparent transaction system. Bybit is dedicated to building an advanced financial ecosystem powered by innovative blockchain technology. With over 1.6 million users worldwide, including both retail and professional customers, Bybit prioritizes customer satisfaction and strives to provide an exceptional user experience.

Bybit Exchange specializes in leveraged futures contracts, offering fair trading opportunities on BTC/USD, ETH/USD perpetual contracts, XRP/USD, EOS/USD, and BTC/USDT. Our review of Bybit shows that this cryptocurrency exchange operates a reliable and secure futures trading platform that is transparent, efficient, and fair.

This article aims to enhance your comprehension of the Bybit exchange. Let's get started.

Bybit: Pros and Cons

Bybit is a cryptocurrency exchange with outstanding advantages. Even so, it still has some disadvantages, but this is acceptable.

Pros of Trading with Bybit

• Bybit offers a user-friendly trading experience, with no KYC required for new users.
• The platform supports both PC-based and mobile app options for logging in and trading.
• Bybit offers high leverage, attractive trading fees, and market-maker rebates.
• Bybit has an Insurance Fund guarantee to mitigate and cover losses.
• Multiple order types are available, including limit orders, partial orders, conditional orders, and market orders.
• Derivative contracts can be settled in both Coin and USDT.
• High bonuses are available to traders on the platform.
• Bybit ranks among the top three established exchanges for the highest trading volumes in crypto derivatives.
•  Bybit fees are among the lowest when compared to other exchanges.

 

Cons of Bybit

• Bybit has a limited number of trading pairs available.
• The platform lacks regulation.
• Trading on Bybit is not allowed for US citizens.
• The authenticity of Bybit's trading volume statistics cannot be independently verified.

How Does Bybit Work?

Opening an account on Bybit is easy and requires only a phone number or email address, as no KYC is required. You can deposit cryptocurrencies or use a third-party app to purchase Bitcoin using fiat currency. Bybit offers margin and futures trading with leverage of up to 100x on Bitcoin and 50x on other currencies. Additionally, customers can purchase short-term insurance to cover losses. The website and mobile app are both equipped with advanced trading features for experienced traders.

Bybit is not ideal for spot trading, where you exchange one cryptocurrency for another. Using leverage means borrowing money to amplify potential returns, but it's important to note that it can also amplify losses and potentially leave you with nothing, especially if you're new to leverage trading. Retail investors are not permitted to buy on margin due to regulations.

You can make three types of orders on Bybit: limit orders, market orders, and conditional orders. A limit order is when you set a buy or sell price, while a market order is filled immediately from the order book and comes with a taker fee. A conditional order is activated once a trigger price is reached, such as a “take profit order” set to take profits after a 50% return on investment.

Features of Bybit

Bybit is a renowned cryptocurrency exchange that caters to traders looking to engage in trade derivatives products, including Bitcoin and various other cryptocurrencies. The platform offers three distinct contract options for trading, namely:

1.     Inverse Perpetual: Bybit's inverse perpetual contract is designed to provide traders with flexibility and convenience. With this contract option, users can trade cryptocurrencies without the limitations of expiry dates. It allows traders to hold their positions indefinitely and close them at their preferred time, providing them with greater control over their investments.

2.     USDT Perpetual: Bybit also offers a USDT perpetual contract option. This type of contract is tied to the stablecoin Tether (USDT). Traders can speculate on the price movements of cryptocurrencies while utilizing USDT as the settlement currency. This provides traders with a more stable value reference compared to directly using cryptocurrencies as the base currency.

3.     Inverse Futures: Bybit supports inverse futures contracts, which allow traders to participate in futures trading using cryptocurrency assets. These contracts have predefined expiry dates, enabling traders to speculate on the price direction of cryptocurrencies within specific timeframes. Inverse futures contracts are commonly used by traders to hedge positions or take advantage of market movements.

Perpetual Futures and The Dual Price Mechanism

A perpetual futures contract is a unique type of derivative that offers distinct advantages for traders. Unlike traditional spot and futures trade contracts, perpetual futures contracts do not have an expiration date. This feature allows traders to hold their positions indefinitely, providing them with increased flexibility and maximizing profit opportunities.

Bybit, as a cryptocurrency exchange, recognizes the value of perpetual futures contracts and has plans to expand its offerings. It intends to incorporate quarterly futures contracts, which would provide additional options for traders to engage in futures trading within specific quarterly periods.

Furthermore, Bybit has expressed its intention to integrate with the popular MetaTrader 4 (MT4) foreign exchange platform. This integration would enable Bybit to leverage the features and capabilities of MT4, offering a more comprehensive trading experience to its users.

To protect traders from potential trade or price manipulation, Bybit implements a Dual Price Mechanism. This mechanism serves as a safeguard against sudden price fluctuations that could lead to substantial losses or forced liquidation of positions due to margin shortages. By employing this mechanism, Bybit aims to create a fair and transparent trading environment, ensuring the integrity of the platform and enhancing user confidence.

Bybit’s Mark to Market Price

“Funding” is a mechanism implemented by Bybit, the cryptocurrency exchange, to ensure a balanced relationship between the spot price and the derivative cryptocurrency exchange price. This mechanism aims to align the spot price and the derivative exchange price by periodically adjusting the “mark price” to the “market price” every eight hours.

The “mark price” refers to the last traded price of the asset on the crypto platform. It serves as a reference point for derivative contracts. Bybit utilizes the funding mechanism to bring the marked price in line with the prevailing market price.

The purpose of this funding mechanism is to maintain fairness and accuracy in the valuation of derivative contracts. By periodically recalibrating the marked price, Bybit strives to prevent potential discrepancies or distortions that may arise due to market fluctuations or trading activities. This helps to create a more transparent and reliable pricing system for traders.

By ensuring that the marked price accurately reflects the market price, Bybit promotes a healthier spread between the spot and derivative cryptocurrency exchange prices. This, in turn, helps traders make more informed decisions and reduces the risks associated with price disparities.

100X Leveraged Trading

Bybit offers the option of utilizing up to 100x leverage on its perpetual futures products. This means that traders have the ability to amplify their trading positions significantly, allowing them to potentially match the maintenance margin requirement. This feature is particularly beneficial for experienced traders who seek to enter larger and more substantial positions in the market.

By providing high-leverage options, Bybit enables traders to maximize their potential returns on investment. However, it is important to note that trading with leverage also comes with increased risk. While leverage can amplify profits, it can also magnify losses if the market moves against the trader's position.

It is crucial for traders to carefully assess their risk tolerance and employ proper risk management strategies when utilizing leverage. Bybit encourages traders to have a thorough understanding of leverage and its associated risks before engaging in leveraged trading.

The Contract Loss Mechanism

In a highly volatile market, engaging in leveraged long or short positions exposes traders to the risk of liquidation if the price falls below the bankruptcy price. Volatility in financial markets refers to the presence of extreme and rapid price swings, which increases the potential for losing some or all of an investment. However, there are measures in place to assist traders who face liquidation and suffer losses. One such example is the Bybit Insurance Fund, which helps liquidated traders cover the deficits caused by their losses.

Socialized Loss system Vs Auto-Deleveraging system (ADL)

The Auto-Deleveraging system (ADL) is designed to protect traders from significant losses by potentially deleveraging positions with the highest profitability and leverage in a specific order. The Auto-Deleveraging system (ADL) ranks positions based on their unrealized profit ratio and leverage.

When the balance of the insurance fund is insufficient to cover the losses incurred by contracts, the ADL system automatically deleverages opposing traders' positions based on their profit and leverage. This mechanism aims to mitigate the impact of high-risk speculators and safeguard traders from abnormal losses.

Traders are ranked based on their margin ratio and unrealized profit and loss (PnL) as a percentage of their collateral. More profitable and higher leveraged positions will be subject to deleveraging first, reducing the potential for losses that could adversely affect other traders' positions.

It is important to note that the specific implementation and rules of the ADL system may vary between cryptocurrency exchanges. Different exchanges might have their own variations of ADL or alternative mechanisms to manage the risks associated with leveraged trading.

Overall, the ADL system aims to promote a fair and balanced trading environment by prioritizing the deleveraging of positions with higher profitability and leverage, thus reducing the potential impact of abnormal losses on the trading community. Traders should familiarize themselves with the ADL rules and understand their position's ADL ranking to manage their risk exposure effectively.

Bybit Type of Orders

On Bybit, there are different order types available for trading:

1. Limit Orders: Limit orders allow you to specify the number of contracts, order price, and leverage. These orders are executed when the Last Traded Price reaches the preset order price. With limit orders, you have control over the price at which you want to buy or sell your digital assets.

2. Market Orders: Market orders also allow you to set the number of contracts and order prices. However, the executed price is determined by the best available price on the order book. Market orders are used when you want to enter or exit the market immediately and react quickly to the current price.

3. Conditional Orders: Conditional orders are advanced order types that are automatically submitted when the specified trigger price is met by the Last Traded Price. Types of conditional statements:

• Conditional Market Order: This order is filled immediately once the trigger price is met.
• Conditional Limit Order: This order is placed in the order book and waits for execution when the trigger price is reached. The execution is pending until then.

These different order types provide flexibility and options for traders to execute their trades based on their specific requirements and market conditions.

Bybit Deposit and Withdrawals

Bybit provides support for five cryptocurrencies, namely BTC, ETH, EOS, XRP, and USDT. Users are initially given separate wallets for each of these assets, but Bybit determines the overall equity based on BTC.

If you have any of these coins stored elsewhere, you have the option to transfer them to your Bybit wallets and commence trading. Alternatively, if you prefer to purchase cryptocurrencies through Bybit, you can utilize the Fiat Gateway.

The Fiat Gateway enables the purchase of BTC, ETH, and USDT using 45 different fiat currencies, including the US dollar, Australian dollar, Euro, and British pound. Currently, Bybit does not offer a USD wallet, so these are the only deposit options available.

Depending on your chosen fiat currency, the platform provides multiple payment options through various third-party service providers. This allows you to select the vendor that offers the most cryptocurrency for the lowest fees and with the shortest processing time for topping up your wallets.

Bybit also features the Assets Exchange (formerly Coin Swap), a tool that facilitates the conversion of one Bybit-supported cryptocurrency into another.

Bybit does not impose a minimum deposit requirement; however, it is important to note that there are purchase limits per order. Specifically, for transactions involving US dollars, the allowable range is between $20 and $15,000.

For withdrawals, it is necessary to enable two-factor authentication and be aware of the Bybit withdrawal fee.

How To Register Bybit Account?

To use the Bybit platform, new users are required to have a trading account. To create an account, you can follow the registration process outlined on the Bybit official website. Please complete the steps below:

1. Go to Bybit's official website.
2. Go to the registration page.
3. Fill in all the required details in the registration form.
4. Take the time to read and understand all terms and conditions provided.
5. Once you have carefully reviewed the terms and conditions, click the “Register” button or similar prompt to continue with the registration process.

Bybit Payment Methods

Bybit supports various payment options for depositing funds into your account, including Visa, Mastercard, Electronic Fund Transfer (EFT) or Wire Transfer, and Bill Payment options. These options allow users to deposit funds using fiat currency. Bybit collaborates with Banxa, Xanpool, MoonPay, and Mercury to facilitate payments through fiat currency.

To make a deposit using the Bybit mobile app, you can follow these steps:

1. Open the Bybit mobile app.
2. Locate the “Assets” tab, usually found at the bottom right-hand corner of the app interface.
3. Tap on the “Deposit” option to initiate the deposit process.

When making a deposit, you will need to select the cryptocurrency you wish to receive in your Bybit wallet address. Currently, Bybit supports BTC, ETH, and USDT as deposit options. You can enter the deposit amount based on either a fiat currency amount or a cryptocurrency amount according to your preference.

Bybit Fees

Bybit specifically differentiates between Makers and Takers in terms of fees. They charge a fee of 0.075% for Takers, who have their orders filled immediately. However, Makers receive a fee rebate of 0.025% for providing liquidity and market depth. The net cost incurred by the Bybit platform is 0.05%.

Additionally, Bybit has specific withdrawal limits and fees. Users can withdraw funds from their Bybit account by entering their wallet address and clicking the withdrawal button. Bybit has a withdrawal limit of 10 BTC, and there are daily withdrawal limits in place as well, typically set at 0.0005 BTC. Furthermore, Bybit imposes a Funding Fee or Funding Rate of 0.02%/-0.02%.

Bybit Insurance Fund

Bybit Mutual Insurance is a risk management tool specifically designed for BTCUSD perpetual contracts. It aims to help users maximize their profit potential during an uptrend or offset losses without needing to exit their long or short positions.

Mutual Insurance encompasses a premium and an insurance fee, where the fee is determined by 0.05% of the insurance amount. Bybit appears to employ the Black Scholes model for options pricing, considering various factors like the insurance amount, volatility of index price, insured position price, maximum payoff, insurance duration, and the balance in the Mutual Insurance Fund.

Settlement in BTC for Mutual Insurance can be prompted by three scenarios: expiration after 2, 12, or 48 hours; manual settlement within the insured period; or partial or complete liquidation of the position.

When purchasing Mutual Insurance coverages, users are required to transfer BTC funds from their trading account to their insurance account. In isolated margin mode, Bybit automatically deducts funds from the trading account if the insurance account lacks sufficient funds to cover the premium.

Ease of Use and Interface

Bybit's trading page may appear daunting to casual visitors, but for those familiar with it, it is arguably one of the most user-friendly crypto derivatives trading platforms available.

Even if you're not an experienced user, understanding how everything functions becomes achievable by taking the time to grasp the platform's fundamentals.

When you're prepared to start trading, you'll find the platform's customizable modules to be invaluable. The layout of the dashboard is well-organized, allowing you to freely move, resize, or maximize the modules according to your preferences.

The mobile application of Bybit mirrors the functionality of its web-based counterpart. The user interface of Bybit is incredibly responsive and designed for effortless navigation. We particularly appreciated the leverage slider, which makes adjusting leverage a breeze, although you also have the option to manually enter a specific leverage value.

Bybit caters to non-native English speakers by providing translation services in seven additional languages, including Japanese, Korean, Vietnamese, Spanish, and Russian. This comprehensive multi-language support extends beyond the trading platform dashboard and covers areas such as Bybit Learn, the Bybit Blog, and the Help Center.

Bybit Referral / Affiliate Program

During the process of preparing this Bybit review, we uncovered several rewarding opportunities for first-time depositors across all supported assets on the platform.

One such reward is the “A Big Deal” coupon, which carries a value of $50. To claim this generous Bybit welcome bonus, all you need to do is deposit an amount equal to or greater than 0.1 BTC, 3 ETH, 1,390 EOS, 11,800 XRP, or a deposit of 5,000 USDT within the initial 48 hours of registration.

If, for any reason, you miss the initial deposit window, don't fret! Bybit still offers a $10 welcome bonus as long as you meet the minimum deposit requirements. This bonus will be awarded to you in the corresponding deposit coin.

Furthermore, you have the opportunity to claim an additional $5 Bybit bonus for making a BTC deposit, as well as another $5 voucher for following the company on social media.

The realm of rewards isn't limited to new users alone. Even existing users can partake in exciting promotions like flash deals, giveaways, and raffles. It's worth checking out the Rewards Hub and Latest Promotions page regularly to stay informed about the available Bybit bonuses on any given day.

By joining Bybit's referral program, you can earn $10 for each new user you invite to the platform. What's more, your referred users will also receive a welcome bonus of $10.

To ensure a successful referral, the new user you invite should:

• Create an account on Bybit using your unique referral code or link.
• Make a deposit.
• Complete at least one trade involving BTCUSD inverse perpetual or futures contracts.
• To invite prospective referees, simply ask them to register on the platform using your referral code or link. You can conveniently share your invitations through a QR code as well.

Now, let's explore where you can utilize these bonuses. They can be used as a margin to cover trading losses and offset fees. However, it's important to note that the bonuses themselves cannot be withdrawn. Nevertheless, any profits generated from trading with the bonuses can be withdrawn.

If you're seeking even greater and more sustainable rewards for introducing new traders to the Bybit exchange, consider participating in their affiliate program. This program allows you to earn lifetime commissions on every new active user who signs up through your referral.

Bybit employs a two-pronged commission model for affiliates. As an affiliate, you can earn 30% of the platform's profits from your referral's trades, in addition to 10% of the earnings generated by your sub-affiliates. A sub-affiliate refers to a referral who becomes a Bybit Affiliate themselves.

The affiliate network currently boasts over 11,000 content creators and influencers from 160 countries, all receiving recurring revenue share per new client on a monthly basis. Bybit proudly claims that their commission rates are over 100% higher than industry standards, and they have already paid out at least BTC 5,600 in commissions.

Bybit Mobile App

Bybit offers a downloadable mobile application for both iOS and Android devices. The Android app, in particular, has been downloaded over 100,000 times from Google Play since its release on October 31, 2019. It has received 2,450 Bybit reviews with an average rating of 4.3 stars.

After installing the Android app and exploring its features for a couple of days, it became evident that it receives widespread approval from traders.

The mobile app offers the same functionality as its web-based counterpart. It provides separate screens for contracts, price graphs, order books, recent trade information, the order zone, notifications, and wallets.

Additionally, the Bybit mobile app includes various strategy alert options. You can activate a customizable widget that sends notifications when the Last Traded Price exceeds your specified alert rate, whether higher or lower.

Furthermore, you have the ability to set up notifications for price spikes and plunges, triggering when the prices of your selected trading pairs experience a percentage change within a five-minute timeframe. You can also configure notifications for changes in open interest.

Furthermore, the Bybit app enables you to schedule a reminder for the anticipated funding rate, sending you a notification 30 minutes prior to the funding settlement for your selected trading pairs. This useful feature ensures that you stay informed and prepared for upcoming funding events.

Bybit Security

The CEO has publicly expressed concerns about the vulnerability of centralized cryptocurrency exchanges to hacking incidents. In this regard, is Bybit distinguished from other platforms in terms of cybersecurity measures?

Certainly, Bybit stands out by prioritizing cybersecurity to a greater extent than the average crypto trading platform. Let's delve into the measures implemented by the company to safeguard your investments.

Bybit Customer Support

Bybit offers round-the-clock customer support on a global scale, ensuring assistance is available through phone or live chat to address any inquiries or concerns. Bybit provides language options in English, Chinese, Japanese, Korean, Spanish, Russian, and Vietnamese.

Users also have the option to contact Bybit via email for specific types of queries:

• Customer Support: [email protected]
• IT Support: [email protected]
• Affiliates: [email protected]
• Media: [email protected]
• Partnerships: [email protected]

Bybit Review: Conclusion

Bybit is highly recommended among crypto derivatives exchanges and offers a remarkable range of features, including perpetual futures trading, margin trading, smart trading system , modern pricing systems, etc.

The platform stands out for its low fees, wide country support, mobile trading app availability, user-friendly design and helpful customer service. However, some users may find it a bit difficult to navigate the exchange if they are a beginner.

Taking everything into consideration, Bybit is undoubtedly one of the top cryptocurrency exchanges in the market. If you are looking for advanced features and a platform that meets all your crypto trading needs, it is definitely worth exploring.