Since Black Thursday, BitMex users take been withdrawing Bitcoins (BTC) from the exchange in droves.

On March 13, BitMex held 306,814 Bitcoins (BTC), past April 9, this number had dropped to 222,025 — this represents a 38% decrease in Bitcoin holdings.

Source: TokenAnalyst

Source: TokenAnalyst

Although it coincides with the contempo tendency of traders moving Bitcoins abroad from centralized exchanges in general, in the instance of BitMex, the drib is more pronounced.

Source: glassnode

Source: glassnode

Traders switching to amend alternatives

The exchange went offline for 25 minutes on March 13. According to BitMex, they suffered 2 DDOS attacks, which resulted in the disruption. However, not everyone believed this explanation.

A prominent trader in the crypto space shared his views with Cointelegraph:

"There has been increased competition to what Bitmex started back in 2022 with the nigh notable being ByBit & Deribit. It is not surprising that if one of these companies upsets its users due to server failure, no thing how brusk the disruption, people will start to consider alternatives."

Another trader claimed that BitMex wrongfully liquidated his leveraged position during the outage which led to a loss of 30 BTC or $150,000. Some have fifty-fifty considered whether curt-selling should be banned in the crypto market altogether.

Founder and CEO of Celsius Network (CEL), Alex Mashinsky believes that the recent "wink crash" may be what injure BitMex in the optics of traders:

"I retrieve they lost the customers they had to liquidate in March during the wink crash. Too many other exchanges now offer exactly the same product and accept many other features BitMEX does non have so it is harder for BitMex to rebuild the customer base."

A popular crypto YouTuber known as "The Moon" posted a video explaining why he removed his BitMex video tutorial, which was once the most pop video on his channel. In the aforementioned video, he urges his followers to stop using the substitution.

he goes on to list several reasons that make BitMex a bad choice for his followers; amidst them — bad customer service, carelessness handling of user data, and trading confronting its users. He besides claimed that the being of ameliorate alternatives has led to users leaving the commutation en masse:

"And I recall that fundamentally BitMex is non a good exchange to be trading on. There are much amend exchanges out there correct now. And these new BitMex alternatives, they are capitalizing off of the bad behavior of BitMex and the fact that people are leaving BitMex in masses."

Price manipulation?

More recently, the commutation has been hit with a form activity lawsuit that alleges that BitMex was selling unregistered securities to U.S. residents. The complaint likewise accuses BitMex of price manipulation:

"BitMEX deliberately based the cost of its futures on spot-market place exchanges that have limited liquidity and are thus relatively piece of cake to manipulate. BitMEX would so engage in manipulative trading on those exchanges to modify the cost of bitcoin or ether."

Losing almost forty% of its Bitcoin deposits in less than a calendar month may signal a serious blow to the in one case dominant derivatives commutation.