After almost $1 billion’s worth of cryptocurrencies was stolen from exchanges in 2018, this year already looks equally challenging. New Zealand-based Cryptopia was hacked in January. In February, the founder of Canadian QuadrigaCX passed away–along with his customer’s hopes of ever getting their cryptocurrency back. He was the sole custodian of the exchange’s cold storage wallets.
Security issues in the Crypto space are a growing concern. It’s hardly surprising that regulators are reluctant to give the green light and clear that the current model cannot continue. Yet, fully decentralized exchanges can’t deliver a robust (or even passable) user experience yet. What to do?
Digitex Futures Is Changing the Way Exchanges Operate
There’s one exchange that’s aiming to buck the trend and looking forward to a bright year ahead. Digitex Futures is a brand-new futures trading platform launching in quarter two 2019 with some decidedly different value propositions. It’s removing fees on all trades and delivering a non-custodial model in which traders control their own accounts.
This means that users of the exchange are no longer at the mercy of opportunistic hackers or ill-prepared exchanges with questionable cold storage policies. They also don’t have to give up any profit in the form of commissions.
For the first time, rather than siphoning liquidity out of the market in the form of fees, the platform makes money on token appreciation–something that aligns the exchange’s interests with its users.
Digitex recently hit one million subscribers on its waitlist, proving that demand for its trading model is high. This will almost certainly be the start of a wave of new exchanges that actually care about their users and allow them control over their funds.
Binance has quickly become the world’s most popular cryptocurrency exchange thanks to its low-fee model. But providing zero fees enables an entirely different style of trading. Short-term traders and scalpers can take advantage of small fluctuations in price and accumulate profits over time.
And, whereas the Binance (BNB) coin provides discounts on trading fees to users, the DGTX token is the only way of accessing the exchange. This means that demand for the token can only increase as more traders flock to the platform and DGTX sees continual upticks in value.
Decentralized Account Balances
Digitex is developed on Ethereum and will be among the first blockchain companies to implement Plasma scaling technology and offer decentralized accounts.
Plasma uses side chains to enable transaction volumes that are far higher than anything previously possible on Ethereum. Developer testing within Digitex has already yielded transaction speeds of up to 25,000 per second.
Digitex is leveraging this new technology to record all transaction and account balances on-chain, with virtually real-time settlements. It also means that the exchange can avoid security issues by having all funds sent to a smart contract. Users have the assurance that their funds are held securely and cannot be lost or tampered with.
Futures Trading to Rival BitMEX
So far, BitMEX has established itself as the king of crypto futures, with the highest trading volumes of Bitcoin futures compared to any other exchange. However, Digitex has BitMEX firmly in its sights.
Along with the zero-fee trading model, Digitex is also offering 100x leverage on futures contracts. It’s also providing Litecoin and Ethereum futures, as well as traditional futures markets, such as stocks, Forex, indices, and gold. This will broaden the audience for the exchange and bring in more retail traders to Crypto.
These traders will benefit from a one-click ladder trading interface that enables lightning-fast ordering. This is key in an industry that sees rapid, significant price swings.
A Solid Long-Term Financing Plan
A few blockchain firms have implemented their own treasuries as a means of guaranteeing sustainable funding over the initial years of doing business. Some notable examples are and Blockstack and Polymath. The latter announced in January that they are locking up 7.5% of their tokens for the next five years.
Digitex is taking a similar approach in setting up its Digitex Treasury. The company has allocated 10% of all available DGTX tokens, 100 million in total, to the Treasury. The funds are held in a smart contract, which is programmed to release them for sale every quarter over the next two and a half years.
Proceeds from the sale will be used to fund development, marketing, and the operational costs of running the exchange.
Warding Off Whales
Having seen the danger of crypto whales for projects and markets, Digitex is thinking out of the box. The exchange is placing a $50,000 cap on the value of tokens that can be purchased through any token sales. This is a strategic move, designed to deter purchases from anyone seeking to gain a controlling stake in the DGTX token.
This ensures that no one person has the power to dump the token onto the market, and drive down the price. All these well-thought-out policies and features are signs that the crypto industry is maturing.
While there are plenty of exchanges to choose from, if you’re looking to get into futures trading, Digitex has some unrivaled features that set it apart from other platforms. Zero-fee trading combined with non-custodial accounts is a compelling combination. And it’s likely that it will force a change in the way things currently work.