FTX is a crypto derivatives exchange trading platform that was built by traders and for traders; it’s kind of still new to the ecosystem because it was launched in May 2019. It was developed by Sam Bankman-Fried who because he found an issue with mainstream crypto futures exchange and in order to address the issues decided to launch his own platform which is FTX token.
Sam Bankman-Fried is CEO of Almeda Research where he manages assets and also Almeda Research is a quantitative crypto exchange platform that is also backing FTX and they are among the top companies that provides largest liquidity in crypto trading. FTX was designed by top professionals so that traders that are trading with it will feel more comfortable and confident using it. What make FTX unique are its selling points and that is, its clawback prevention, it’s a universal stablecoin settlement and it’s a centralized collateral pool.
FTX has its own exchange token which is FTT, and the mechanism in which it benefits from is the buy and burn mechanism. How it works is that, it uses up 30% of fees generated through the exchange, and buys back FTT from the crypto market and burns them therefore decreasing the supply of the FTT and making it deflationary or making it scarce in the market in order to reduce the price probably.
Some benefits of the FTT holders is that they get to enjoy low or no trading fee, higher referral bonus, perks and even IEO (initial Exchange Offering) votes and even get to have their blockchain fees for FTT waived , that is, for stakers.
What really makes FTX and FTT unique or cool?
FTX offers a tokens that allows trader to put leveraged positions without having to trade on the margin and eventually the trader per se wants to long Ethereum with let’s say 10x leverage, all he has to do his buy 10x long Ethereum leveraged token on FTX. The token in which FTX offers is called leveraged tokens and it allows trading derivatives a lot accessible.
One issue traders faces is that when trading traditionally crypto futures, the collateral is usually fragmented across separate token wallets which is a big problem for the traders because it prevents positions for getting liquidated. But when comes to the FTX derivatives, it stablecoin settled that is, traders will now be able to trade with just one wallet thanks to FTX because it’s a stablecoin settlements according to its key feature or selling points.
Aside the stablecoin settlement selling point the FTX is proud of, one also that the community still love is the clawback prevention. During trading, so many traders has recorded a lot of losses to other derivatives exchange but what FTX does is to reduce it by using what they call three-tiered liquidation model which is a complex method.
The only risk FTT faces is if eventually FTX fails to accomplish is mission or goal and that is to become the largest derivatives exchange platform in the world. And I think they are already getting there due to the FTX NFT marketplace already in place.