Derivatives have a crucial role in financial markets, both in the traditional stock market and in cryptocurrency exchanges. They are responsible for key functions, such as allowing traders to speculate on the present moment on future prices without having to purchase an underlying asset itself (gold, oil, etc.).
Besides, derivatives also can act as an important risk-management resource for traders. Positions such as futures, forwards, swaps, and options can be resourceful to lock in prices and prevent negative price movements from incurring losses for traders.
In the cryptocurrency industry, it couldn’t be different, as investors realized that hedging a position with derivatives can be a good strategy to avoid unexpected market moves.
In this sense, ACDX is a new platform focused on advanced derivatives trading, mixing positions involving cryptocurrencies and real-world assets such as gold and equity derivatives.
Back to Basics – What Are Derivatives?
A derivative can be explained as a contract between two or more parties, whose value is based on an agreed-upon underlying financial asset. The most common underlying assets include bonds, commodities (e.g. oil), currencies (including crypto), interest rates, market indexes, and stocks.
Derivatives are considered secondary securities whose value is solely derived (as the name suggests) on the value of the primary security that they are linked to, which is the underlying asset.
There are two categories of derivative products, called “lock” and “option.”
Lock products (e.g. swaps, futures, or forwards) obligate the contractual parties to the terms over the life of the contract. On the other hand, option products such as stock options, offer the holder the right to buy or sell the underlying asset at a specific price on or before the option’s expiration date.
When it comes to cryptocurrency markets, derivatives also have a fair share of the industry. Currently, Asia has become the centerfold for cryptocurrency derivatives. Countries like Singapore, where cryptocurrency regulation is looser than in most places worldwide, has intense and active trading exchanges based on its soil.
In this sense, several leading exchanges based in Asia such as Huobi, OKEx, and Binance are experiencing higher trading volumes in their derivatives markets in comparison with their spot markets.
What Is ACDX?
Advanced Cryptocurrency Derivatives eXchange or ACDX is a platform focused on the next-generation crypto derivatives exchange. Their goal is to provide innovative trading products such as gold and equity futures along with well-structured crypto products.
The crypto derivatives market can be divided into two different categories, which are first-generation exchanges and next-generation exchanges. This designation does not mean to be an evaluation of efficiency and productivity, but simply to divide it into two different approaches.
First-generation exchanges were more focused on spot exchanges, being more market-focused and limited when it comes to implementable trading strategies.
Next-generation exchanges, such as ACDX, are designed by expert and seasoned traders to fulfill a more sophisticated demand for trading unique products. This way, ACDX has a more product-focused approach, permitting more advanced strategies and positions to take place, hence leveraging the returns.
Dig Into It
ACDX permits investors to take multiple positions on crypto derivatives, trading traditional assets like gold and equity derivatives with cryptocurrency. The environment is auspicious for profitable returns, as the platform offers full derivative contract specifications, clear market rules, and user-friendly costs of trading.
By offering a robust trading mechanism, ACDX can deliver a high-level performance tool for advanced crypto traders. The platform is empowered by a light-speed responsive and resilient matching engine, saving investors time both when trading and managing derivative positions.
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Skilled traders will be able to leverage their positions up to 100 times at ACDX, given the multiple strategies and hundreds of different positions available. Customer service is another highlight of the platform, which offers 24/7 support for investors.
Despite having an approach more suitable for advanced crypto traders, the platform did not give up on its ease of use and accessibility. The interface is customizable and intuitive, so even individuals who have a hard time with graphics and numbers will not have a single reason to concern.
ACXT – ACDX Token
Considering that the fundamentals behind a crypto exchange are users and liquidity, ACDX’s team came up with the idea of establishing a marketplace to facilitate asset exchanges.
In this sense, they developed a native token, called ACXT, which will be the ACDX’s governance token. Users will be able to earn ACXT tokens by providing liquidity (maker orders) to the platform.
ACXT holders will be empowered to make decisions regarding the platform, such as the vote to modify token burn rates, fees, handling of hard forks, etc.
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Other important decisions include voting to decide on listings at ACDX, as well as voting to modify contract specifications, features, and functions at the platform.
ACDX has launched a public beta on the 29th of September 2020. Investors can purchase convertible ACXT (called CACXT) at Uniswap, buying at the initial price of US$1.25. As the main token is still a few weeks away from its main launch, this batch is a response to the huge demand of the community.
Security and Accessibility
Sparing no effort to deliver a secure environment for crypto and derivatives trading, ACDX partnered with BitGo. Published on Forbes, CoinDesk, and Fortune, BitGo is the leading company in institutional digital asset custody, trading, and finance.
Given the complex nature of the digital finances, the California-based company offers a multi-signature technology, where keys are divided among several owners to manage risk. Besides, any personal information of investors and traders is 100% encrypted, to preserve safety and privacy within the network.
ACDX promises to be the world’s first crypto exchange offering advanced structured products in a transparent and innovative platform. Investors will be exposed to several profitable positions on derivatives on cryptocurrencies, gold, and equity derivatives with leverages up to 100 times.
Another innovation brought by the platform is the use of the governance token ACXT. The token will be given as a reward for liquidity providers, which will have the power of vote on decisions regarding the platform such as token burn rates, fees, ACDX listings, and other essential questions.