Digitex Futures Exchange is an innovative new Futures exchange model that eliminates transaction fees and commission fees and covers up for this by creating its own native token. They offer up to 100x leverage so traders have the potential of making huge profits. Digitex uses a hybrid model of centralized and decentralized components by combining the speed and reliability of a centralized order matching engine with a decentralized smart contract that holds traders’ funds hence providing security. This makes it possible for them to provide a trustless trading service that does not require traders to release funds to the exchange before submitting trade orders.
Digitex also gives traders complete privacy by allowing users start trading immediately without submitting their personal document for KYC/AML.
The Procedures for KYC/AML is actually intrusive and pointless because it misses one of the major points of cryptocurrencies – anonymity. Most projects who require KYC have no means of verifying the documents in different countries and they receive a lot of fake documents which they eventually end up approving. Ruling out KYC procedures ensure that identity of users is kept safe which is very important considering the prevalent cases of identity theft. It also makes the exchange less of at target to hackers who are interested in the personal info of users.
Existing futures exchange charge ‘Maker’ and ‘Taker’ fees for every corresponding order a trader submits. A maker fee is charged when a trader places an order that does not fill immediately or is not entirely filled at once (eg, limit order). The idea is that placing such orders make the market. A Taker fee is paid when a trader places an order that is immediately filled entirely (eg, market order). The idea is that the trader is “taking” the price he wants by submitting that order.
Taker fees on popular exchanges like GDAX, Kraken, Cryptofacilities and Bitmex range from 0.08% to 0.26%. When these fees are deducted from the profit of traders, it becomes obvious that the trader did not make much profit.
For instance, on another exchange, say CryptoFacilities.com:
If I am a short term trader and I see the price of BTC/USD start to increase, I buy 10 bitcoin worth of futures contract at the price of $8500 and sell off at $8520, making a profit of $200.
But I need to have 10 × $8500 × 0.167 (that is 16.7%) = $14195 in my account, held on the exchange, to meet the initial margin requirement to execute my trade.
Going by their fees, Buy: 0.08% × 10 × 8500 = $68
Sell: 0.08% × 10 × 8500 = $68
Total commission fee = $68 + $68 = $136
This means that my profit at the end of the day is $200 - $136 = $64
Trading on Digitex Futures Exchange:
I quickly jump in and buy 500 BTC/USD futures contracts at $8500.
If I decide to sell off when bitcoin gets to $8520, since the tick size of the BTC/USD futures contract is $5, when bitcoin price increases by $20 then I just made 4 ticks profit (20÷5 = 4) on a 500 contract which is 2000 tick profit (4×500).
1 tick =1 DGTX token hence my profit is 2000 DGTX. If the market price of DGTX tokens at the moment is $0.1 it means I just made $200 profit.
What I needed to have in my account balance to execute the trade is 500 × 20 DGTX = 10,000 DGTX which is $1,000 in my account balance, held on an independent smart contract to be able to carry out the trade.
Since there are zero fees and zero commissions, my total profit is $200.
Let’s say traders were sad that most of their profits is being cut down by commission fees. On the other hand, the Digitex team wanted to build the best crypto futures exchange. The Digitex team turned into a genie and asked traders to make a wish.
Hence they built a commission-free futures exchange that charges zero transaction fees.
However, revenue will be needed to maintain the platform and cover operational costs. To achieve this, Digitex created their token which will be used on the exchange and will be in constant demand as traders need the tokens for trades. Starting from early 2021, a small number of tokens will be minted annually to generate revenue.
The number will be decided using a decentralized blockchain governance where token holders will cast their vote. 1 DGTX = 1vote
The Digitex exchange will go live in 2-3 months time and there will be a live demo of the Digitex platform at the blockchain summit in malta. Before then, you can sign up and gain early access to the exchange.
Stay up to date on Digitex by following these links:
- Website: http://www.digitexfutures.com
- Twitter: @digitexfutures
- Facebook: @digitexfutures
- Join the waiting list: http://digitexfutures.com/get-early-access