Welcome to Slate Sundays, CryptoSlate’s new weekly feature showcasing in-depth interviews, expert analysis, and thought-provoking op-eds that go beyond the headlines to explore the ideas and voices shaping the future of crypto.
Stephan Lutz is the CEO of BitMEX, the industry’s longest-standing crypto futures exchange, dating all the way back to when BTC was still in diapers.
From his swanky Singapore office, a busy skyline of skyscrapers behind him, he smiles confidently through the camera, rolling his eyes only slightly as I ask about his background. “I’ve told it so many times already,” he groans.
I jokingly suggest we switch to the AI version of him for a moment, or that we cover the topic very briefly, but Stephan isn’t a man who does things in brief. Our chat went on for more than an hour. It’s not often that you meet someone who can articulate their thoughts on the GFC, Brexit, crypto derivatives, and memecoins in the same breath.
From the bulge bracket to BitMEX
You might call Stephan something of an overachiever. With a background in business administration, economics, banking, and finance, he cut his teeth as a corporate finance analyst at Dresdener Bank.
He then moved to the consultancy side, scaling Deutsche Börse, Europe’s largest stock exchange operator, before working his way up to partner at PwC. He shares:
“I advised large bulge bracket investment banks during Brexit, the ECB, for example, on certain financial stability matters. I did a lot of work around bank recovery and resolution planning after the great financial crisis, and I was part of one of the teams that said what needed to be liquidated in the end.”
From mopping up the spills of 2008 to providing insights into a Brexit-driven financial climate, Stephan was approached by BitMEX in 2020, which he says:
“Led to a situation that no one had seen coming apart from me.”
With his blue-chip background in consultancy and finance, not even a crypto-native firm like BitMEX knew how fascinated Stephan was by blockchain technology, having become enchanted by its possibilities very early on at Deutsche Börse.
In 2010, he couldn’t see it replacing the Börse’s high-speed securities booking infrastructure with its five transactions per second speed, but he knew it was the future.
“I always followed the crypto industry, more so on the technology side, and the underlying real-world use cases for that. So, when BitMEX asked in 2020, it was like, finally, I can get my hands “dirty” with something that I’m interested in! It took me three days to accept the job without even negotiating the salary, and people said, ‘You’re head of capital markets at one of the biggest audit and advisory firms in the world. What are you doing?!’”
He smiles, with a wicked glint in his eye. Stephan doesn’t strike me as a person who cares too much about what other people think; despite the incredulity of his peers, he ran toward BitMEX with open arms:
“They asked me specifically because of my background, a regulation/compliance/audit guy, helping with adding credibility. Of course, I have all of this, but I was always a rebel, and I always liked to do things differently. They thought they hired a very risk-averse guy, and in the end, I’m actually rather the opposite.”
The OG crypto derivatives exchange
BitMEX is the industry’s “OG” derivatives exchange, founded in 2014, and while its trading volume is 80% institutional, it remains the playground of individual traders: around 80% of its half a million or so users are retail accounts. Stephan says:
“We are strong in crypto derivatives, and especially Bitcoin-denominated crypto derivatives. We are the OG brand, the original.”
10 years of operations in most industries is just a trifle, but in crypto, it equates to decades. BitMEX was built on the ashes of Mt. Gox and has survived, arguably, thrived throughout many a bump in the road. I ask Stephan how BitMEX continues to compete in a now crowded market. He reflects for a moment before replying:
“Let me give you an example of what we are not. We don’t operate a launchpad like many Asian exchanges, because that means you need to have new projects flowing in, and then you sell them. It’s a marketing tool. You have a spot exchange next to it. We don’t do this. We look at top coins, or top pairs, or top contracts. 10 assets make up 99% of our volumes. Why? Because we provide derivatives, futures, and perpetual swaps. That’s it. ”
While he’s proud of the fact that BitMEX is open to everyone, he’s quick to emphasize that he would never recommend his mom or kids to onboard with BitMEX if it were the first thing they wanted to do in crypto.
“I would say, no, no, no, no, don’t do this, because you need to have a certain level of education and experience.”
Yet, in the spirit of live and let live, if someone wants to take a risk, they should be able to do it without being mollycuddled or gatekept:
“I think we live in a free world, and it should be a free world.”
Of course, he highlights BitMEX’s role in user education and the plentiful resources the exchange puts out to ensure that traders are taking an informed risk.
“We are totally transparent. Even our technical documentation is publicly available. We give BitMEX Alpha out regularly, the crypto traders’ digest, and we do other courses… I mean, if you close your eyes, we can’t do anything about it, but if you’re going in with eyes wide open, you know what you’re going to do.”
Built on the rubble of Mt. Gox
Launching on the debris of Mt. Gox, which saw 142,000 BTC drained from its users, BitMEX has always been security-conscious. It’s one of the few exchanges in crypto that has never been hacked as a result.
Since the crypto winter of 2022, when “the shit hit the fan,” and FTX blew up, dragging half the industry with it, Stephan says BitMEX overhauled its entire frontend and backend infrastructure and processes to put “more focus on risk management.” He laughs:
“Despite everything you read about it, BitMEX is one of the most conservative crypto places on this planet. Why? Because we do just a few things. Number one, we have always been very focused on derivatives for professionals, and number two, we have full segregation of assets.”
In a business terrain fraught with landmines at every turn, BitMEX has never compromised on customer fund security. All assets are secured via secure multi-party computation (MPC), and all transfers are protected by transaction rules that assure any attack is blocked at a policy level.
“Our funds and customer funds have never been commingled. Our engine checks on a second-by-second basis. If all positions don’t add up to zero, the engine stops, and we investigate.”
I confess to Stephan that my memories of BitMEX go back to the cowboy days of retail traders getting rekt, and Crypto Twitter baying for BitMEX’s blood. The company has come a long way since then. He pauses:
“To this cowboy, “Wild West” thing, we could have done more in terms of educating people, but we have even been sued for market manipulation, and all those have been proven wrong in court, officially. All of those legal cases have gone away by now. We have fought them all through. The evidence was clear. The engine worked as intended. If I put in an order that’s using up 100% of my collateral, and the market moves against me, then I am liquidated. That’s just how it works.”
He says that in the early days, people were new to the concept of futures, and that led to more liquidations. Fast-forward to today, and there has been a sweeping sophistication and institutionalization of the space, just like in traditional finance.
“It was the same in TradFi. All this equity trading became retail in the 80s, right? I mean, all this Wolf of Wall Street stuff. In the 10 years we have been in crypto, I would say, in terms of professionalization, we are maybe where the TradFi world was around the early 2000s or so, maybe a little bit earlier.”
Bridging TradFi and crypto with copy trading
BitMEX launched its new copy trading feature earlier this month, which Stephan describes as bridging the worlds of TradFi and crypto. In TradFi, he explains, users have many options to earn a passive income, such as exchange-traded funds, index trackers, and more.
“Why do people love ETFs? I mean, next to, hey, it’s efficient because you pay less fees than for active management. It’s copy trading basically.”
Copy trading enables users to benefit from the experience and success of professional traders and easily replicate their strategies.
“It just means, if Stephan does something, I want to have the same. It’s like in Harry and Sally, with the restaurant scene, I want to have the same, and those two, oh, this lady, right?” Why is that good? If you have traders who are good, and you open this up, there are two things. The copy followers actually learn something, because they will see what is traded when, and it’s like a passive investment. I just follow the lead of someone else.”
BitMEX’s copy trade feature enables users to emulate multiple traders at once, to not “put all your eggs in one basket,” and the call can be reversed as well: if you find a trader whose strategy you disagree with, you can set up your preferences to do exactly the opposite.
“So if a trader buys, for example, Ethereum, I sell Ethereum, and the other way around, and then you can calibrate by saying, I copy it by 100%, I copy it by, let’s say, something between 0 and 100%. So, calibrating your risk level. You really can pick and choose what is good for your risk level.”
Genius acts, institutional plays, and BitMEX’s next moves
As an Asia-based exchange, BitMEX has never catered to U.S. traders, but with a changing of the guard at the White House and a relaxation of rules surrounding crypto, is that likely to change in the future? What does Stephan think of the Trump administration and the latest moves to come out of Washington? He pauses for a moment before replying:
“I think the GENIUS Act was genius. They basically turned a competitive disaster, relative disaster, into a competitive advantage within a couple of days.”
So, is BitMEX actively exploring the U.S. market, then? He laughs:
“It depends on what you mean by ‘actively’. We are actively exploring what we would need to do to re-enter the U.S., which is, it would cost us the better part of 18 and 24 months to do that in a valid way, because you need to be on the ground, we are not.
You need to then start with the right license, and go state by state, it takes time… So we are looking at this, but don’t expect us to open up a BitMEX office in the next half year.”
What else is on the cards for BitMEX for the rest of 2025 and beyond? Stephan says he will be sharing news at TOKEN2049 in October, and I can’t help but wonder if there will be any news of a stateside expansion despite his coy denial.
In other plans, he says, BitMEX will roll out its institutional-grade custody solution, having recently moved its data centers from Dublin to Tokyo in a strategic move to cater to institutional traders. He explains:
“The majority of all the crypto exchanges outside of the U.S. run their data centers in Tokyo. I mean, no one knows that. Why it’s an institutional thing for the market makers in particular, it makes hedging between venues easier. It’s not creating new issues to trade, but we enhance efficiency for our institutional customers through this capital efficiency, so they need to deploy less capital.”
Standing on the shoulders of giants
We’ve gone way over time, and the sky behind Stephan is dusky and tinged with pink, but as we wrap up the interview, I have one more question. I’m dying to know what it’s like to follow in the footsteps of such an outspoken CEO, like Arthur Hayes.
He pauses for the longest time since we’ve been recording, and I fleetingly wonder if I’ve lost audio, before he carefully says:
“It’s good, it’s an honor, and it’s difficult.”
He says the “legacy is great,” and the name opens doors for him; even when he was a partner at PwC, he didn’t receive so much enthusiasm for getting in a room with him.
“When I was at PwC, and I called someone to pitch for my idea for a consulting project or whatever, it was like, hey, I’m Stephan, I’m the capital markets leader at PwC in Europe, and would you have time for me? And the answer never was a no. It might be, I only have time in eight weeks from now, which is a semi-no.”
He doesn’t have that problem now, but admits that it’s challenging at times because being the co-owner and CEO of a firm is not the same as being a CEO only. He can’t always execute as fast as he would like to or as decisively as his predecessor. Still, he smiles, he’ll take it anyway.
“The privilege is I can go to basically any person in this industry and say, ‘Can we have a chat?’ And usually I get one, which is a big help already in driving the business. I would say this is the privilege I was handed over.”
The post ‘I was always a rebel’: BitMEX CEO Stephan Lutz on leading crypto’s perpetual playground appeared first on CryptoSlate.
