FTX has quickly become a crowd favorite among Traders since the exchange launched in May 2019. While other exchanges such as Binance, Kucoin and Huobi have began to embrace margin and futures trading on their platforms this year, FTX has proven to be one of the best cryptocurrency exchanges for Traders who are looking for an exchange with not only high liquidity but a vast amount of crypto coins to trade with up to 101x leverage.
What is FTX?
FTX launched in May of 2019 and was incubated by Alameda Research, a top cryptocurrency liquidity provider. Compared to Exchanges like Kucoin or Huobi, FTX has no issues with liquidity regardless of the current Altcoin market and the lack of volume we’re currently experiencing on most other exchanges. FTX offers Perpetual Futures Contracts, Leveraged Tokens, MOVE Contracts and even an OTC desk built right into the platform. FTT powers the FTX platform and is another great addition to the plethora of Excange Tokens out there with a burn strategy and several use-cases in place to make it not only valuable to own but to use as well. FTX allows users to deposit cryptocurrencies like Bitcoin and convert their holdings to USD Stablecoins for use on the various markets the exchange provides.
Perpetual Futures Contracts
The main attraction to platforms like FTX is often the opportunity to trade using leverage. In short, leverage multiplies the amount of money you can trade with, the amount of profit you can make but also the losses you can suffer as well. In times of low volatility, responsible Traders will often use higher leverage to make more profit on smaller moves and tune the leverage back down when the instrument they’re trading picks back up. The general consensus among Traders is that beginners should start trading spot (no leverage) and then explore 3x, 5x and 10x leverage once they’re consistently profitable.
FTX currently offers Perpetual Futures Contracts on popular Altcoins such as TOMO, MATIC, ATOM, LINK and more as well as the usual BTC, ETH, XRP and other majors. We’ve seen Altcoins added to the FTX platform regularly since their launch in May and the Team seem to be very responsive to customer feedback; adding community favorites and index-type contracts like DRGN (Chinese coins), MID (Mid-cap Altcoins) and even SHIT (Low-cap Altcoins). In terms of a unique difference in value compared to the other major exchanges, FTX is very capable of developing products that are exclusive and consistently popular.
If you’re not interested in trading perpetual contracts, FTX offers their range of Leveraged Tokens that enable traders to spot buy real ERC20 tokens that represent 3x and 10x long positions as well as 1x, 3x and 10x short positions. Leveraged Tokens are an easy way for Traders who aren’t familiar with Futures Contracts to realize larger profits. It’s important to keep in mind that these Leveraged Tokens work similarly to Futures Contracts in the way that not can you maximize your profits using higher leveraged tokens, losses can be made just as quickly.
On each Leveraged Token a simple description is shown which explains each token in simple terms. For instance, the 10X Long Matic Network Token (MATICMOON) is an ERC20 token which seeks a return that corresponds to 10 times the daily return of Matic Network. We’ll include a more detailed description from the FTX Leveraged Tokens Help page below:
“For example, take ETHBULL, a 3x long ETH token. For every 1% ETH goes up in a day, ETHBULL goes up 3%; for every 1% ETH goes down, ETHBULL goes down 3%.
There are currently three leveraged tokens for every future on FTX: BULL (+3x), BEAR (-3x), MOON (+10x), DOOM (-10x), and HEDGE (-1x).
If ETH goes up 1%, then ETHBULL goes up 3%, ETHBEAR goes down 3%, ETHMOON goes up 10%, ETHDOOM goes down 10%, and ETHHEDGE goes down 1%.
If ETH goes down 1%, then ETHBULL goes down 3%, ETHBEAR goes up 3%, ETHMOON goes down 10%, ETHDOOM goes up 10%, and ETHHEDGE goes up 1%.”
We’ve written a few Leveraged Token guides which have proven to be quite popular as Traders become more aware of options outside of regular spot trading. We’ve got the feeling that competing Exchanges won’t be far off offering this sort of option to their own customers in the near future.
Move Contracts are a recent addition to the FTX Platform and are available to Traders who wish to bet on volatility rather than direction. We’ll go ahead and link the official FTX MOVE Contracts Help Page as it’s slightly more complicated compared to Futures Trading and requires a bit more understanding around contract expiry and the different options available. While we won’t go into detail about MOVE Contracts here to avoid confusion, the product is very clearly a response to the communities need and want for more options outside of betting on price action.
Finally, FTX has an incredibly generous referral program for those looking to introduce FTX to their friends and fellow Traders. At the time of writing, FTX offers new Traders who sign up under a referral link a 5% saving on their trading fees across the platform. Referrers who bring Traders to the FTX Platform are rewarded with 30% of the trading fees generated by those they referred. For example, if you invite a Trader and they generate $100 USD in fees over numerous trades, the person who referred them can claim $30 USD of these fees and either use them for their own trading or convert them into Bitcoin and withdraw them from the Exchange at any time.
FTX also offers custom referral links for those looking to personalize their referral marketing. We grabbed https://ftx.com/#a=PickACrypto and a few others. Traders who wish to protect their brand or name can register up to 5 custom referral links and change them at any time if they become unsuitable or simply want to register others for various reasons..
Why You Should Be Trading On FTX
If you’ve made it this far down, we’re pretty sure you’re more interested than you were before. FTX is an Exchange that aims to offer far more than their competition and evidence shows they’re not afraid to try something new. Traders all over Twitter have been exploring FTX for most of the year and we’re glad to offer our insight into the platform and its opportunities. If you enjoyed this article or learnt something new, sign up to FTX using our referral link and help us keep making content like this.