The Foundations of FTX
The FTX Exchange first began live trading in Q1 of 2019 and since its foundation has been very aggressive in its growth strategies. Aiming to take the down the top dog in cryptocurrency derivatives BitMEX. One such growth strategy is the addition of new and innovative trading products. Products such as new indexes and leveraged tokens have helped the exchange gain notoriety in the past few months.
FTX launches new trading products every week, and this week was no different. Launching their markets for Ethereum Classic and their brand new exchange token index.
It is no surprise that FTX has been consistently adding more markets. They are effectively owned by Alameda Research. One of the largest quantitative trading firms and liquidity providers in the cryptocurrency space. They make their money by providing liquidity and exploiting market inefficiencies. The more markets they have at their disposal the more money they make. This is partially the reason why FTX now has the largest amount of markets for any cryptocurrency derivatives exchange.
FTX Launched 5 tradeable pairs for Ethereum Classic. ETC Perpetual Swap, ETC September Futures, and 3 leveraged ETC Tokens. ETCHEDGE, ETCBULL, and ETCBEAR. Leveraged tokens are ERC20 tokens which seek a return that corresponds to 3 times the daily return. For example, if you buy ETCBEAR tokens you make 3x the loss of ETC, while if you buy bull tokens you make 3x the gain of ETC.
Exchange Token Index
Perhaps the most exciting product FTX has released in a while is its Exchange Token Index. The index is comprised of 4 tokens. Bitfinex’s LEO token, Huobi Token, OKEX’s OKB token, and Binances BNB token. Exchange tokens have bucked the trend of Altcoins in the 6 months. While Altcoins hit rock bottom, exchange tokens actually made positive ROIs. This index allows traders to exploit that market and gain exposure to the major 4 exchange tokens. Three interesting omissions from the index are FTX’s own exchange token FTT, BitMAX’s token BTMX, and Kucoin’s KuCoin shares. FTX however have said they are open to changing their indexes as they progress to find the right combination.