Digitex A Fee Free Decentralized Crypto Futures Trading Exchange

cryptouno (64)in #ethereum • 6 years ago (edited)

Futures Explained
Futures are contracts in which you buy or sell an asset at a set price in the future. A seller of a future is a short position holder & a buyer is a long position holder.

Futures have been beneficial for various markets since they have a stabilizing affect on the rate of exchange and the price of the asset.

Those trading futures will protect their asset since they want to profit from their trade at the time the futures contract is to take place.

This keeps market prices from violent fluctuations. Futures is an excellent way to trade cryptocurrency.

source

Crypto Futures Trading Example
I make an order on Digitex that I would like to purchase 70 Bitcoins once the price hits 6000 dollars. Once the purchase is made I become a long position holder.

I now would like to short Bitcoin at 7000 dollars so I create the order to do so. If I am correct I gain 70000 dollars off my trade.

If I am incorrect then I do not make these profits. All do if I am correct and gain 70000 no fees will be deducted from my winnings.

There will also be no wallet transfer fees since my private wallet is also my exchange wallet.

Problematic Fees
Most Futures Exchanges derive revenue from various kinds of fees. These fees are a kind of unofficial tax on active traders. Trading fees always take a chunk of profits made from trading.

The fees can add up costing a trader a significant portion of their revenue. There are currently few options when it comes to trading cryptocurrency futures.

Digitex the Game Changer of Futures
Digitex covers cost by minting new tokens that marginally inflate the token. Before tokens can be minted token holders must reach a consensus on how many tokens should be minted.

The exchange is a hybrid between Digitex centralized servers and accounts held on the decentralized Ether network. This not only gives the trader security but provides them with high trading speeds from the centralized servers.

This provides real time trades which are far more satisfactory. The security provided by the Ethereum network gives traders piece of mind.

Traders Control Private Keys
private key.png

source
A traders account balance is held in an Ether contract separate from the exchange in order to maintain a decentralize exchange. This is one of the only exchanges that gives the trader control of their private keys.

Exchanges do not normally give traders control of their private keys so a trader must fully trust that the exchange will take care of their account. Having control of private keys is a far superior option to having to place all your trust in an exchange.

I own all the private keys to my cryptocurrency but if I want to trade I must transfer them into my exchanges account. These transfers come with fees.

Since Digitex gives traders their private keys not only is it an exchange account but it doubles as a private account that is linked to the exchange to perform instant trades.

Digitex can't in any way spend a traders assets since they have no access to private keys which are needed to control an account.

Having control of private keys means that no one can freeze assets in the account. This is because the exchange does not have any control over the traders account unlike other exchanges.

If the worse happens and the exchange gets hacked there are no funds for the hacker to take since all accounts containing funds are under the control of traders not the exchange. By spreading the funds among traders and not centralizing it in one location makes Digitex a very secure platform

Digitex Liquidity
The exchanges native currency is Digitex so in order to trade on the platform a trader must hold Digitex.

Since traders must purchase Digitex this keeps the value of the token stable. Digitex does not plan to mint any new tokens for two years after the exchange launches. Digitex will be be funded with the funds from their ICO.

One of the greatest advantages of Digitex is that if they are hacked there are no assets that can be stolen. The reason for this is because the traders hold all their own private keys which makes Digitex one of the safest platforms around.

Trades can choose to trade Ether against the US dollar, Litecoin against the US dollar, or Bitcoin against the US dollar.

Digitex Commitment to Users
Digitex does not do Auto Deleveraging. Auto Deleveraging is when a futures exchange basically cancels your winning trade. Futures exchanges do this in order to avoid high losses.

This is an unfair practice since the trader should receive their winnings for correctly predicting market movement.

They do not cancel futures trades when the trader makes a bad prediction but when they make a correct big prediction they cancel the trade.

This is an immature way to run a futures exchange and it means that you will never truly make a high profit off of trades. Digitex will honor all trades and payout because they aim to be the best futures exchange.

Conclusion
There have been numerous exchanges that have been hacked. One of the most memorable is the Mt.Gox hack which at the time handled around 70% of all the worlds Bitcoin trades.

Mt.Gox is a perfect reason as to why exchanges should not be fully centralized. Having assets all in one place makes exchanges a clear target.

It is an irresistible target for those with the skills to easily penetrate an exchanges security. Digitex offers a solution to a problem faced by exchanges.

Digitex will revolutionize trade and by 2020 we could see their trade volume being one of the highest.

source