Btc.sx
| Trading name | Btc.sx |
| Industry | FX Trading, Brokerage, Financial Services |
| Founded | May, 2013 |
| Headquarters | London |
Btc.sx is a multinational company that engages in leveraged bitcoin trading and brokerage. The company offers a trading platform in digital currency derivatives such as margin trading to retail traders. It was founded in 2013 and is headquartered in London's Silicon Roundabout. ZDNet reports Btc.sx to be one of the first bitcoin companies that voided the necessity of all other currencies other than Bitcoin.[1] The company was launched from Sydney, Australia, and is run by CEO Joseph Lee who co-founded the company alongside George Samman and Vincent Hoong.[2] Shortly after its launch, Lee moved operations to London favouring a dual incorporation model between Singapore and United Kingdom.[3] The company also has operations in New York.
Trading
Buying and selling
Users of Btc.sx can open long and short positions using the proprietary trading platform. A corresponding buy and sell order is then placed out to market at a matching exchange with or without leverage. All positions opened will have a corresponding position placed out to market meaning that any profits gained or losses generated from market movements will be passed on directly to the client.
Position Deposits
Trading at Btc.sx is done on a pre-paid basis. In order to open a position, a deposit is taken which acts as collateral. This collateral will act as an equivalent of a margin call. This is the price at which a position will be automatically liquidated if losses accrue to the deposited amount. The margin call is shown as a stop price when the position is opened. A larger deposit will enable a bigger stop distance to be chosen. This can result in larger losses if the price moves against the desired direction.
Features
Leverage - 10:1, 5:1, 2:1
Volatility Multiplier - 15%
Execution Type - at best execution over ECN
Minimum Trade Size - $5 equates to ~$50 Trade at 10:1
Maximum Trade Size - $1000 equates to ~$10,000 Trade at 10:1Cite error: Closing </ref> missing for <ref> tag
| Leverage | Stop Distance | Risk | Return (Profit or Loss) | Minimum Deposit |
|---|---|---|---|---|
| 10:1 | Small | High | High | $5 |
| 5:1 | Medium | Medium | Medium | $10 |
| 2:1 | Large | Low | Low | $20 |
Reception
Following the Mt. Gox collapse, Btc.sx announced a new exchange partnership with Bitstamp now placing its orders out to market.[4] The trading platform announced in March 2014 the brokerage of over $40m in brokered transactions.[5]
Capital investments
In April 2014, Btc.sx recieved 500 bitcoins from the seed accelerator, SeedCoin in its first fund raising round.[6] The company has recieved a total of US$0.45 million investment as a result of initial capital injections and its equity fundraising activities.[7]
Service disruptions
In February 2014 Mt. Gox was struck by a theft, it was the world's largest bitcoin exchange and at its peak handled 70% of all bitcoin trades.[8] The loss of 750,000 bitcoins (at the time worth over $350m) triggered immediate insolvency and caused its subsequent collapse.[9] Following a trading suspension issued by Btc.sx, it was revealed that Btc.sx had partnered with Mt. Gox to offer its brokered trading service and suffered from undisclosed losses as a result of the collapse.[10]
Regulation
Btc.sx operates in a climate of regulatory uncertainty with no specific laws enforced to provide protection to its clients globally. The New York State Department of Financial Services who is overseen by Superintendent Benjamin Lawsky hopes to be the first regulatory body to provide a full framework for virtual currency businesses.[11] The DFS guidelines are percieved by many bitcoin companies to be overbearing with fierce opposition coming from Jeremy Allaire, CEO of bitcoin startup Circle.[12]. With operations in New York, the BitLicense regulations will directly affect Btc.sx and similar bitcoin businesses.
External links
- ↑ ZDNet - Startup opens Bitcoin-only margin trading platform
- ↑ | accessdate=2014-08-21 Btc.sx - About the Btc.sx Team
- ↑ Australian Financial Review - Tech start-ups leave Oz over tax
- ↑ Btc.sx - Normal Trading Resumed
- ↑ CoinDesk - Bitcoin Derivatives Platform BTC.SX Resumes Trading After Mt Gox-Induced Freeze
- ↑ CoinDesk - Trading Site BTC.SX Receives 500 Bitcoins in Seedcoin Funding Round
- ↑ ZDNet - Startup opens Bitcoin-only margin trading platform
- ↑ 5 things about Mt. Gox's crisis
- ↑ The Guardian - Bitcoin exchange MtGox offline amid rumours of theft
- ↑ CoinDesk - Bitcoin Derivatives Market Btc.sx Suspends Trading Amid Turmoil at Partner Mt. Gox
- ↑ New York State Department of Financial Services - NY DFS RELEASES PROPOSED BITLICENSE REGULATORY FRAMEWORK FOR VIRTUAL CURRENCY FIRMS
- ↑ CoinDesk - Circle: BitLicense Would Force Us to Block New York Customers