In 2015, a hike in Hong Kong's countryside led to the creation of the perpetual swap, a groundbreaking financial product that would go on to redefine the crypto trading landscape. Ben Delo, co-founder of BitMEX, was on that hike, grappling with a problem that had been plaguing him for months.
His company had tried various futures contracts, but customers kept complaining about positions closing unexpectedly. They wanted a product that combined the benefits of spot trading with the leverage of derivatives. Delo's friend and fellow hiker, Bavik, a derivatives trader, suggested a future with no expiration date. Although mathematically this would result in an infinite value, Bavik proposed charging traders an overnight rate, similar to LIBOR in traditional finance.
This concept ultimately led to the invention of the perpetual swap, a product that would become a cornerstone of crypto trading. The story of BitMEX and the perpetual swap is one of innovation, perseverance, and the relentless pursuit of solving a problem that seemed insurmountable at the time.