Yes. BitMEX holds a small portion of funds in MPC (multi-party computation) hot wallets to provide efficient withdrawals. The private key is never held in one place; creation, signing, and revocation are performed in a trustless distributed manner between co-signing components, adding security beyond a standard hot wallet.
How does the BitMEX MPC hot wallet work?
BitMEX holds a small portion of user funds in MPC (multi-party computation) hot wallets to ensure an efficient withdrawal process for customers. Hot wallets remain connected to the network, which allows BitMEX to process withdrawal requests without the delays associated with accessing cold storage. Keeping only a limited allocation in hot wallets minimises exposure while maintaining operational responsiveness.
Unlike a standard hot wallet where a single private key controls all signing operations, MPC technology distributes the key across multiple independent components. The private key is never stored in, or reconstructed at, a single location. Key creation, transaction signing, and key revocation are all performed in a trustless distributed manner between a threshold of co-signing components. For a transaction to be authorised, a predefined number of these independent components must participate in the signing process.
MPC architecture adds a significant layer of security over traditional hot wallet designs. Even if an attacker compromises one co-signing component, that party alone cannot authorise a withdrawal. The distributed signing requirement eliminates single points of failure and protects against both external attacks and potential insider threats. Combined with policy-level transaction rules that govern transfer amounts and destination addresses, the MPC hot wallet system provides robust protection for the funds it holds.
For details on how BitMEX protects the majority of funds held offline, refer to the What Is a Cold Wallet? article.