Cryptocurrencies

Can the current Bitcoin Cash futures contract go to zero on Bitmex?

The currently traded BCHZ18 futures contract started trading on 28th Septemeber, with a final contract settlement scheduled for 28th December. The contract trades BCH against BTC pair with a maximum possible leverage of 20x.

On 10th November, Bitmex came out with an ‘endorsement’ to the ABC side of the chain by stating, “On settlement, the BCHZ18 contract will settle at a price on the Bitcoin ABC side of any split and will NOT include the value of Bitcoin SV”.

Jumping the gun

It does seem that Bitmex jumped the gun on this one. At the time of the announcement, most other large cryptos exchanges had refrained from taking sides and instead only gave updates about the disruption to deposits and withdrawals for BCH at the time of the fork – rather than pick a side.

Crypto Twitter commentator, Rhett Creighton, pointed out that, “Bitmex BCH futures can go to ZERO. That’s because they are actually BCH ABC futures as of Nov 9th. Someone could even spend $1M for 1 hour of hashrate just to make it look like SV will win”.

This morning Whalepanda pointed out that “Bitcoin SV just flipped Bitcoin ABC on the Poloniex ‘futures’ market. Hashrate and price are now higher for Bitcoin SV”.

This is an extremely worrying sign for Bitmex regardless of the fact that the approach is consistent with Bitcoin Cash initially splitting off from Bitcoin in August 2017.

If SV wins then Bitmex’s BCH contract will trade towards zero.

Nawaz Sulemanji

Nawaz has been hooked on crypto since buying his first Bitcoin’s in 2013. After studying maths in London, Nawaz initially spent the first eight years of his career working globally across corporate supply chain’s before transitioning into the decentralised finance industry as a margin-trader and consultant. He’s a fan of open-blockchains because “it enables self-sovereignty”.