Crypto KOL Phyrex said in a post on X that BitMart and BitMEX did not fail because of a blowup similar to FTX, arguing that their core problem was business deterioration. He said BitMart had approached people around him for acquisition talks in 2023 and that data work was carried out at the time, but the process eventually went nowhere. In his view, part of the decline among smaller, lower-tier exchanges came from pressure tied to Binance Alpha, which gave altcoins, community tokens, and other fringe assets a better venue and cut into listing fees and coordinated market-making profits once earned by those exchanges. Phyrex also pointed to the migration of copy-trading leaders, saying their numbers were limited but they often brought waves of followers with them. When a newer platform offered better profit opportunities, those traders would quickly move their users over. He added that several better-known exchanges that later ran away had broadly followed that pattern.
Odaily reported that crypto KOL Phyrex said in a post on X that BitMart and BitMEX "did not shut down because of a blowup," adding that their situation was very different from FTX and that the main issue for both platforms was business-related.
According to Phyrex, BitMart had reached out to people around him in 2023 to discuss a possible acquisition. He said a fair amount of data work was done at the time, but the matter eventually went nowhere.
Phyrex said part of the downturn at many third-tier exchanges came from pressure tied to Binance Alpha. He wrote that smaller exchanges had long served as a base for various altcoins, manipulated tokens, pyramid-scheme tokens, and community coins. After Alpha emerged, those tokens found what he described as a better destination. That, in turn, reduced listing-fee income at smaller exchanges and also cut profits from coordinated market-making arrangements.
He also pointed to copy-trading leaders as another factor. While the total number of those leaders was not especially large, he said they typically managed repeated waves of followers and moved across exchanges on a regular basis. Once a new exchange offered better profits, those leaders would quickly bring their users to the new venue.
Phyrex added that several better-known exchanges that later ran away had broadly followed this pattern.
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