#夏日创作营 The Farewell of the Inventor of Perpetual Futures: Why BitX Ended Up Here

On July 23, the well-established crypto derivatives exchange BitX announced that it would officially permanently shut down on September 23 at 04:00 (UTC) and had immediately stopped accepting new user registrations. Its parent company, HDR Global Trading Limited, said this decision was made after a strategic review of its business and the entire crypto industry. Starting August 26, BitX will implement position limits—no new positions will be allowed, only position reduction and liquidation; it will then gradually force liquidations to wind down the market in an orderly manner. Any positions that remain open when the exchange closes on September 23 will be directly force-liquidated. This means that this exchange, which has been operating for more than 11 years, will completely exit the historical stage.

An inventor of an era
BitX was co-founded in 2014 by Arthur Hayes, Ben Delo, and Samuel Reed. Its best-known accomplishment is that it pioneered and popularized perpetual futures—before this, the crypto derivatives market only had traditional futures contracts that settle. Perpetual futures combined with up to 100x leverage helped BitX rise rapidly during the 2017–2019 bull-market cycle. At its peak, its annual trading volume once exceeded $1 trillion, holding about 57% of the global crypto derivatives market share. In July 2018, daily trading volume hit a high of $8 billion, and daily turnover at one point exceeded 1 million BTC.

It can be said that the product prototype behind the perpetual futures business now pushed by exchanges such as bn and Byb is essentially what BitX laid the groundwork for. Worth noting is that the company emphasized that during more than 11 years of operation, there has never been an incident in which funds were stolen by hackers.
Wounded by regulatory strikes, its market share eroded by competitors
BitX’s decline is, in essence, a multi-year tug-of-war. In 2020, the U.S. Department of Justice charged BitX and three co-founders with violating the Bank Secrecy Act by failing to establish effective anti–money laundering and customer identity verification procedures. In 2022, the three pleaded guilty to the relevant charges. This long, drawn-out regulatory battle caused the founders to step away from the company’s day-to-day operations one after another, and left BitX stuck during the window period when it most needed to focus on its business—precisely when offshore exchanges such as bn and Byb were rapidly rising and taking market share. According to Kaiko data, BitX’s share in the global crypto exchange market is now below 0.01%, essentially negligible.
Interestingly, the founders later also received presidential pardons from U.S. President Donald Trump, as part of his crypto industry regulatory-relaxation policies—yet this long-delayed “exoneration” can no longer undo the market position BitX has lost over many years.

Failed to find an acquisition, and ultimately chose a dignified exit
As early as February 2025, BitX hired the investment bank Broadhaven Capital Partners and initiated a sale process in an attempt to find a buyer, but it was unable to reach a deal all the way through. During this year as well, the company also lost key executives one after another, including the CEO, CFO, and the head of growth, leaving management nearly cleared out within three weeks. After the shutdown announcement was released, BitX’s own platform token BMEX promptly crashed by more than 90%, and its market value shrank to about $497k. In its statement, the company characterized the shutdown as “the end of an era,” rather than a forced exit due to financial distress, saying, “Although today it looks different from back then, we are proud of the history of more than 11 years and of the role we played in shaping the entire crypto industry.”

Not just a company story, but a snapshot of shifts in the industry landscape
To some extent, BitX’s exit reflects the double squeeze facing centralized derivatives exchanges as a whole: on one side is large-scale competition from centralized platforms such as bn, Byb, and OK. According to CoinGecko data, in Q2 2026, the perpetual futures trading volume on centralized exchanges fell by 10% to $1.27 trillion. On the other side are decentralized perpetual futures exchanges (perp DEX) represented by Hyperliquid, which continue to seize market share and have now captured 13.5% of total open positions. For exchanges like BitX—which are already marginal in size and have carried regulatory history burdens for years—the significance of continuing to operate independently under such a double squeeze is no longer that great.

Written at the end
Perpetual futures, in a sense, has become one of the most representative—and also most controversial—financial innovations in crypto. It allowed ordinary traders, for the first time, to participate in contract games with extremely high leverage and no settlement, reshaping the industry’s trading culture as a whole. And its inventor ultimately did not fall because the product failed; instead, it fell to a long regulatory tug-of-war and the subsequent erosion of market share. This is a reminder to everyone in the crypto industry: first-mover advantage and technological innovation are undoubtedly important, but whether one can get through the compliance cycle and defend existing market share is often the key variable that determines how far an exchange can go.