How a Hong Kong Hike Paved the Way for a Revolutionary Crypto Trading Innovation

In 2015, a hike in Hong Kong's countryside marked the beginning of a groundbreaking concept in crypto trading - the perpetual swap. Ben Delo, BitMEX's co-founder and a mathematician, was discussing a persistent problem with a friend, Bavik, a derivatives trader. BitMEX had experimented with various futures contracts, but customers continued to express frustration over positions closing unexpectedly. They desired a product that resembled spot trading but offered the leverage of a derivatives exchange. Delo posed a question: what if a future never expired? Bavik's response was immediate: mathematically, it would be worth infinity. However, he suggested charging traders the bitcoin overnight rate to address this issue. The problem was that this rate did not exist at the time. Delo decided to create it, and in doing so, he invented one of the most influential financial products of the 21st century. The story of BitMEX and the perpetual swap is a testament to innovation and the power of simplicity in financial markets.