Bybit is a cryptocurrency derivatives exchange with a wide range of advanced trading tools. It has top-notch security and a no-down-time commitment, but it’s not available in the U.S. Read our full Bybit review to find out if it’s right for you.

This cryptocurrency derivatives exchange is a good fit for: Non-U.S. cryptocurrency traders who want to use margin and other derivatives.

Bybit Pros

  1. Up to 100x leverage on crypto
  2. Advanced tools supported by great technology
  3. Risk-free test environment to learn and experiment
  4. Educational resources

Bybit Cons

  1. Not available in the U.S.
  2. Crypto derivatives are extremely risky
  3. Not suited to spot trading
  4. May share your data with third parties for marketing

Bybit Top Features

Before we get into the perks, let’s take a quick look at what exactly derivatives are. Derivatives are financial instruments — also known as contracts — that base their value on an underlying asset. You don’t own the asset. Instead, you own a contract to buy or sell that asset at a specific price in the future. In this case, that asset is cryptocurrency. Bybit is a cryptocurrency derivatives exchange, which means it’s a place where those contracts are bought and sold.

Up to 100x leverage on crypto

You can trade cryptocurrencies on Bybit at up to 100x leverage. This means you could trade a position of $10,000 from a $100 investment. Experienced traders can make high profits from leveraged trading as it magnifies the potential trading rewards. But it also magnifies the risk.

Users can go long or short on the 15 available currencies (bet on the price rising or falling, respectively). Bybit offers a range of advanced trading options.

Technology and tools set it apart

Bybit says it can handle 100,000 transactions per second, which is significantly faster than its competitors. It does everything possible to avoid any server downtime, a problem a number of exchanges face whenever a change in the market pushes a lot of people to trade at once.

Its charting tools are popular with traders as they have a lot of functionality and extra features. You can also download data in various formats.

Risk-free testnet environment

Bybit has a testnet site where new traders can test strategies and learn how to use the site without using real money. If you’re new to derivatives, it’s a way to get used to these advanced — and sometimes complex — tools.

Since leveraged trading can be extremely risky, it makes sense to gain confidence in the test environment before risking your hard-earned cash. If you decide to trade for real, start small and make sure you understand how to minimize risk.

Educational resources

Bybit has an impressive selection of resources, news, and insights for traders of all levels. For example, “Bybit Learn” explains how to use technical tools and understand chart patterns. It teaches users about decentralized finance (DeFi) and has detailed analysis of individual coins. Plus, Bybit hosts classes on social media twice a week.

That’s a good thing, since futures and margins are advanced financial tools and you’ll need to have a sound understanding before you use them.

What could be improved

Not available in the U.S.

The United States has strict regulations in place to control both derivatives trading and cryptocurrency exchanges. Bybit is not available to customers in the U.S. and some other countries, such as the U.K. To use its site, you have to actively confirm you are not from the U.S.

As there are no Know Your Customer (KYC) checks, you may be tempted to go ahead and use the service. But it’s a big risk as your account could be frozen, meaning you wouldn’t be able to access your money. And you could be breaking the law.

At the end of last year, the Commodity Futures Trading Commission (CFTC) filed charges against another big crypto derivatives exchange, BitMEX and its executives. The CFTC says the company received more than $11 billion in deposits from U.S. customers and that it will seek the return of “ill-gotten gains.”

BitMEX is challenging the action. Nonetheless, this is a warning shot for derivatives exchanges and U.S. customers who use them. There are a number of excellent cryptocurrency exchanges that are licensed to operate in the U.S. (although many don’t offer margin trading). But they’re worth a look if you’re a U.S. trader.

Crypto derivatives are extremely risky

Using leverage in a volatile market like cryptocurrency essentially enables people to bet borrowed money on a particular outcome. The problem is that if the bet goes wrong, they could completely wipe out their money.

Here’s how it works: Say you go long on Bitcoin at $100 with 5x leverage. Your total investment is $500 ($100 of your money and $400 that’s borrowed). However, the price doesn’t go up as you’d hoped — instead, it falls 20%. Your position would only be worth $400. At that point, it would be liquidated because the exchange can’t allow you to lose more than you initially invested. You would lose your $100 even if the price rose immediately afterward. And you may have to pay a liquidation fee.

A recent report from Carnegie Mellon University into crypto derivative trading pointed out that smaller investors were disproportionately affected by liquidations. It also raised concerns about the impact derivative trading has on the overall volatility of the market.

How Bybit works

Bybit does not have any KYC requirements, so you only need a phone number or email address to open an account. You can deposit cryptocurrencies or use a third party app to buy Bitcoin with fiat (traditional) money.

It offers margin and futures trading at up to 100x leverage. Bybit users can get 100x leverage on Bitcoin and 50x leverage on other currencies. Customers can also take out short-term insurance against losses. For advanced traders, both the website and mobile cryptocurrency app are packed with useful features.

You can just exchange one cryptocurrency for another. But if that’s all you want to do, Bybit is probably not the best choice — it isn’t set up for spot trading.

If you’ve never used leverage before, you’re essentially borrowing money to amplify your potential returns. It’s also called buying on margin. Regulators don’t allow retail investors to buy on margin because you may also amplify your losses and can easily be left with nothing.

You can choose to go long (bet that the currency will gain value) or short (bet that the currency will lose value). Here are the three main types of order you can make:

1. Limit: An order to buy or sell at a price you set.

2. Market: An order that’s filled straight away from the order book. You’ll pay a taker fee and have less control over the price you pay.

3. Conditional: This order is activated when your trigger price is reached. For example, you might set a “take profit order” to take profits once you’ve made a 50% profit on your investment.

Fees overview

The three types of fee to watch out for are trading fees, withdrawal fees, and deposit fees. For trading, Bybit charges a maker/taker fee. This depends on whether you are adding or taking liquidity from the market.

Bybit Cryptocurrency selection

Depending on the type of trade you want to do, Bybit has the following 15 currencies available.

  1. Bitcoin (BTC)
  2. Ethereum (ETH)
  3. Bitcoin Cash (BCH)
  4. Litecoin (LTC)
  5. Tezos (XTZ)
  6. Chainlink (link)
  7. Cardano (ADA)
  8. Polkadot (DOT)
  9. Uniswap (UNI)
  10. Ripple (XRP)
  11. NEM (XEM)
  12. SushiSwap (SUSHI)
  13. Aave (AAVE)
  14. Dogecoin (DOGE)
  15. Tether (USDT)

Is your cryptocurrency safe with Bybit?

Bybit has a number of security measures in place to protect your assets. It stores 100% of client funds offline in cold storage. It also individually reviews each withdrawal request manually to avoid unauthorized withdrawals.

Bybit participates in a bug bounty program that encourages ethical hackers to report any loopholes in its system. It also carries out background checks on all its employees.

At a user level, Bybit has enabled two-factor authentication for withdrawals and changes to account security settings.