It is no news that the debut of the blockchain technology came with many prospects. A decade down the line, we can now see that the network (blockchain) has been able to touch virtual every part of the global economy. The impacts have been felt in the financial sector, from where it moved down to other sectors of the economy.
Aside from the many features, especially decentralization that it brought, the blockchain technology would also be remembered for the massive developments it brought to the digital sphere. The introduction of cryptocurrency exchanges is the most significant of it all. Through the platform, we can now buy and sell cryptocurrencies and many other digital assets. Although the smart contract technology had been the primary trigger of transactions via that medium, the Hydax cryptocurrency exchange came up with another approach called the “Perpetual Contract."
Understanding Contract Trading
Contract Trading is a new model that is exclusive to many cryptocurrency exchanges/trading platforms. It involves the delegation of virtual contract products/derivatives, which can be settled using either the BTC or the USDT. The idea is that transactions facilitated in that manner can be able to scale through the bearish moments, courtesy of the higher stability of the aforementioned crypto coins.
There is also the belief that it would bolster the financial derivatives and trading capabilities. With those in place, the status of the Hydax Perpetual Contract as one of the many forms of asset contract trading would be enhanced.
On the one hand, one of the reasons behind the expected massive adoptions of the Perpetual Contract is because of the robustness over other term contracts, such as weekly, sub week, and quarterly contracts. In this instance, the income in the contract is settled in real-time. Also, the Perpetual Contract is not open to automated delivery and the positions are opened and settled at any time. What an excellent way to trade on cryptocurrencies and overcome the bearish markets without breaking a sweat.
The Roles of the Hydax Perpetual Contract
There are more to this amazing contract than the features as aforementioned. If you’re passionate about using it, then you need to figure out other features that make it the traders’ favourite.
In the light of the conventional/regular profit-making model of buying crypto coins at lower prices and selling them off at higher rates, you would now have a different approach. That new approach is the introduction of the Hydax Perpetual Contract as a way of maintaining the market values of many cryptocurrencies.
Features of the Perpetual Contract
If the Perpetual Contract is as viable as has been posited in many quarters, then you need to have some ideas about how it intends to regulate the crypto market. I’ve been able to get some insights into how it operates. I would share some of the features below so you can understand what you’re getting into.
8-Hour Settlement
It’s no news that many cryptocurrencies now take hours and even days before transactions facilitated through them are completed. That informs the reason why the Perpetual Contract aims at cutting down on the spent to settle transactions. One of the most robust settlement options it has in place is the 8-hour settlement model. In this case, the passion is to ensure that all the transactions are received and confirmed within eight hours.
In addition, both the buyers and the sellers of crypto coins would pay the fee of the transaction(s) every eight hours. Worthy of note is that the Singapore Time of 4:00, 12:00, and 20:00 would be used to maintain the 8-hour transaction settlement. The idea here is that the transacting parties and investors would not have to pay the rate fee if there were no position held at the time of settlement.
Due Date
There are no chances for the settlements to be due. Instead, by the operational model of the Perpetual Contract, the users would be able to facilitate transactions, any time, any day. There are no due dates neither is there settlement dates and expiration dates. Moreover, the contract product never expires.
The Trading Model
You can use the Perpetual Contract in many use cases. One of such is when you intend trading. You would soon discover the features that are prevalent in the trading model approach of the contract.
• Hedging
Ideally, we understand that hedging funds, especially crypto funds can be helpful when the market is bearish. You want to be sure of the actual direction of the market before deciding on whether to sell or hold on for a while.
In this instance of hedging via the Perpetual Contract, there would be the delegation of the virtual contracts to hedge the price fluctuation. That, in turn, aids the avoidance of the risks caused by the fluctuations in commodity prices, especially within a specific period.
Worthy of mention is that the hedging comes in two forms. The first is the long hedge, which allows the investors to buy a contract product in the future. On the other hand, the short hedge entails selling the purchased product in the future. Whichever option you select, the fact is that you would be able to manage the risks better.
There is also the Maximized Term of Hedging. It ensures that the Perpetual Contract doesn’t have a delivery date limit. It is also able to control the market in a way that the fluctuation prices would be between 50-60%.
Speculative Arbitrage
When the crypto market begins to have some turbulence, the investors tend to engage in panic buying and selling. Such has been the case for many years, but it is all about to change for the better.
Under the Speculative Arbitrage of the Hydax Perpetual Contract, it has to do with the usage of leverage to expand the size of funds in the contract. Aside from the acceleration of losses via the addition of leverage, it is also possible for Speculative Arbitrage to bolster the achievement/attainment of greater profits.
Final Words
Cryptocurrency trading just took another dimension with the debut of the Perpetual Contract exclusive to the Hydax cryptocurrency exchange. With massive adoptions, we would now be able to sleep with our eyes closed having in mind that we can sail through the stormy crypto weather using the Hydax-powered Perpetual Contract.
Below are some useful project links to get more insight on this unique exchange
🌐 Hydax Official website
💬 Hydax Exchange Group
💬 Hydax Bounty Group
📣Bitcointalk ANN
🔖 Download app
🐧Twitter
📄Medium
🐇Reddit
writer's info
Bitcointalk username: deodivine1
Profile URL : https://bitcointalk.org/index.php?action=profile;u=1390292
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Hydax UID 492693304107092992
