How does Bitmex make money offering leverages?

BitMEX makes money offering leverage by charging a flat % fee on the [notional] value of the trades. The order ‘Takers’ pay 0.025%. by offering 100x leverage, the value of the orders is increased and therefore, the amount of fees charged and collected also increases.

0.025% is a small amount as fee – so they have to offer leverage to increase the volume traded, otherwise there would be little or no profit.

Also Bitmex traders trade against each other not against the exchange. Moreover, BitMEX created a reserve fund to ensure that all traders are properly paid even if they trade with 100x leverage. Basically they profit from the trading fees that they receive.

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