- FTX Exchange is a centralized cryptocurrency that deals with derivatives and other leverage products
- On FTX, users can interact with varying stocks of companies such as Apple, Google, Facebook and Netflix.
- This essentially introduces the stock market into the blockchain ecosystem and its rudimentary way of combining both cryptocurrency and the stock market has led to its increased popularity
It is common knowledge that cryptocurrency is an innovative venture to decentralize our financial institutions and promote blockchain technology. Many are still profiting from it, and with the current focus on Africa, more and more opportunities are likely to present themselves to young and enthusiastic African minds.
However, this vision has experienced some difficulties, primarily the constant volatility of the market. Many crypto investments have gone sour because of this, the major contributing factor that generally ‘scares’ new crypto minds.
Various cryptocurrency platforms aim to make crypto trading and mining safer to mitigate volatility. FTX Exchange, the centralized cryptocurrency with its FTT token, is an example of a company that offers safe crypto investments.
What is FTX
FTX Exchange is a centralized cryptocurrency that deals with derivatives and other leverage products. In 2019, Sam Bankman-Fried founded one of the most significant enterprises that facilitates and supports various features that create a safe environment for crypto investments.
The main driving force behind FTX was to bring various trading options that offered better security to its users. Initially, the centralized cryptocurrency exchange focused on the future crypto market. This allowed traders to create a contract containing information stipulating which digital assets they were to buy or sell and when they would.
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Various underlying blockchain technology and smart contracts ensured the fulfilment of these conditions at their stated time. This popular kind of trading allows traders to control or predict the price movement of a digital asset without actually having to hold it.FXT exchange now has various additional features such as; a range of trading products, including derivatives, options, volatility products and leverage tokens.
Leverage tokens allow traders to take a ‘leveraged’ position in trading without dealing with all the complexities of the entire margin of trading.
Its native cryptocurrency is the FTT Token. Because of their diverse options in crypto investments, the FTT token has received numerous worldwide support from investors and currently trades $100 million daily.
FTX Exchange Features and Products
The centralized cryptocurrency offers a variety of features, tools and products that smoothen the transition between a newbie and an expert. Its primary vision is to mitigate the various problems and shortcomings experienced by standard cryptocurrency platforms. To do this, it has applied different blockchain technology within its ecosystem.
It supports a variety of fiat currencies that FTX can convert to FTT Tokens. They include; the U.S. dollar, euro, British pound, Australian dollar, Canadian dollar, Swiss franc, Brazilian real, Ghanaian cedi and Argentinian peso.
To ensure safe crypto investments, FTX Exchange has also implemented various products. They include;
- Futures – This allows customers to make both long and short-term bets on leading crypto coins using over 100 quarterly and perpetual futures. They must provide some form of collateral which can be stablecoins such as USD and Tether. FTT tokens are also applicable here.
- Leverage Tokens – By offering EC20-based tokens, FTX provides traders up to 3 times leveraged exposure against the underlying trading pair. A prime use case is when a trader makes a crypto investment on USD- 3 times long Bitcoin token and Bitcoin rallies 10% from the time of the purchase, the leverage token would still gain a 30% rise.
- Option – Traders can estimate the future price direction and invest in reducing the risks of price fluctuation against their position with a range of optional features. This releases any obligations to buy or sell at a future strike price.
- Move – This contract lets a crypto trader estimate a crypto coin’s price move irrespective of its direction. If the coin’s price moves to its estimations, it generates some profit.
- Spot Market – FTX offers financial instruments that enable smooth crypto investments providing exposure to leading cryptocurrencies.
In addition, FTX has established various schemes that help increase the network’s effectiveness and demand for FTT tokes decreasing circulation supply. According to reports third of all the profits generated by FTX are used to repurchase FTT. This concept is commonly known as Token burning, which reduces the number of coins, increasing their value.
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What makes FTX unique
The centralized cryptocurrency exchange offers multiple features allowing long-term and short-term crypto investments. Its blockchain technology allows a wide array of blockchain-based derivatives products.
These are merely tokens that derive their value from other assets, such as stocks. It is similar to stablecoins, but it’s also fundamentally different. On FTX, users can interact with varying stocks of companies such as Apple, Google, Facebook and Netflix.
This essentially introduces the stock market into the blockchain ecosystem. Its rudimentary way of combining both cryptocurrency and the stock market has led to its increased popularity.
In 2021 FTT started with a value of $5.99.At the time of writing, its value was $23.13. The FTT token has experienced multiple highs reaching up to $84.18. As a result, it lures numerous crypto traders to its vast potential.
In addition, it was designed to improve the utility of the FTX exchange. This earned users free rebates and discounts on trading fees and offered a staking feature commonly seen in the PoS mechanism.
By pushing new products, the centralized cryptocurrency exchange has constantly entertained its users, giving them a new challenge, a new product to learn. This consistent blockchain technology upgrade has positively impacted its network, establishing long partnerships with its customers and investors.
Cons of FTX Exchange.
FTX offers a variety of opportunities, but it is not perfect. There are several potential downsides to the centralized cryptocurrency exchange.
Its vast array of products negatively impacted its attempts to attract new users. Most beginners find this overwhelming and hence opt to look for other means. Its lack of customer support options further escalates this problem to the point that FTX mainly targets experienced traders instead.
Although the FTT token offers lower transaction fees, other platforms still provide better.
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According to The Tie, a market data provider, FTX is the safest centralized cryptocurrency exchange platform to conduct any crypto investments due to its liquidation policies. Its numerous options have greatly improved the lives of crypto traders on a global scale. It will require some practice and trading to utilize its tools fully.
FTT token has allowed investors to profit off cryptocurrency in many ways, not just mine or reading. Its blockchain technology has also offered additional security for its network. FTX is a tool worth looking into.