Trade Crypto Futures and Options with Quedex’s Bitcoin-Focused Derivatives Platform

Jan 03, 2018 at 17:00 // News

With Bitcoin futures newly-introduced to the derivatives industry, online traders can soon look forward to accessing Bitcoin futures and options market on the world’s first consistent Bitcoin denominated derivatives online platform – Quedex.

Announcing its open beta launch, the Gibraltar-based financial instruments firm will enable crypto traders to sell and buy Bitcoin options and futures contracts.

The derivatives market opens up additional investment channels for traders who do not own actual Bitcoins in their portfolio, allowing them to buy contracts at determined prices and making shorting options available and settling contracts in fiat.

Recognizing the demand from the crypto economy, Quedex has stepped in to offer a full range of Bitcoin-denominated derivatives, providing top-notch professionalism that serious traders will appreciate on top of a highly secure platform that allows for customized and unique risk management.

Bitcoin-Centric Trading Instruments

The recent launch of Bitcoin futures has been regarded as a positive development for Bitcoin, with the move widely seen as an overall legitimization and recognition of the world’s most popular cryptocurrency.

However, the products currently offered are meant to be fully cash settled and are, therefore, of little relevant use to the crypto sphere with little desire to engage in activities external to the crypto market. Derivatives denominated in Bitcoin are seen as better aligned to the needs of crypto traders and investment hedgers in this case.

Traders wishing to take long positions on Quedex stand to gain additional benefits in the light of the projected continuous appreciation of Bitcoin price. On the other hand, those hedging on short positions avoid the permanent risk of short future positions as warned by clearing institutions, since Quedex shorters are fully collaterized, eliminating the vulnerability to margin calls.

Additionally, the non-stop operation of Quedex does away with the weekend trading pause and resulting gap risk that all fiat-centric markets are exposed to.

Derivatives as a Haven from Volatility

As observed from commodity futures, such as oil and gold, derivatives have a calming effect on their markets with their extreme liquidity. However, futures in their current form restrict traders to direct price speculation, with hedging only freezing the dollar value of Bitcoin portfolios.

Options have always been a way to protect investors from the risk of downside, while keeping the profit potential of holdings. At the same time, traders holding options can profit from swings in both directions of the market – essentially taking advantage of Bitcoin volatility as well as price.

With this in mind, Quedex makes it possible for traders to create a comprehensive range of positions that puts them at an advantage in virtually any market conditions, with the platform able to facilitate a diverse range of strategies, whether bullish or bearish.

The Long Road to Bitcoin Options and Futures

Options on Bitcoin actually made their appearance six years earlier in 2011, but faced its share of challenges in maintaining consistency with prevailing inverse futures standards, according to Matt Wywial, Quedex Co-founder. Wywial further explains:

“Only that way active traders can easily hedge their option positions with futures or apply put-call parity in options arbitrage. Quedex is the first one to offer bitcoin-denominated futures and options consistently, each with $1 notional amount."

Existing futures traders can easily add new instruments with Quedex, seamlessly hedging options with futures and on other liquid markets and accessing a massive leverage of up to 25 times. Since both derivatives are settled in Bitcoin, no real money deposits are ever required.

Ultimate Security

Quedex was developed with the highest security features in mind. It boasts a unique risk management system that balances auctions to protect against those trying to game the system, avoiding cascading margin calls and flash crashes. All of its traders funds are kept in cold storage multi-wig wallets, requiring multiple party physical signing to access. With PGP encryption protecting all interactions between clients and the trading engine, and private-public key digital signatures as authentication, all funds are protected to the highest levels.

Crypto-Friendly, Legitimate Jurisdiction

Of the EU member states, Gibraltar is among the most supportive of Bitcoin and blockchain technology. In the same spirit, Quedex is progressing towards compliance under formal Blockchain & DLT regulations approaching on January 1st, 2018.

The Quedex Edge

  • Industry standard-compatible, consistent Bitcoin-denominated options and futures

  • Options permit trading while performing as a hedge against volatility, regardless of market swings.

  • Virtually barrier-free entry with $1 futures and options contract sizes. Current futures avenues start at a 1 BTC entry.

  • 25x leverage means advanced risk management.

  • Uncompromising security: end-to-end encryption and multi-sig cold storage.

  • Bitcoin friendly, blockchain conducive jurisdiction.

  • All products have zero-cost trading until the end of January 2018.

For more information, visit the Quedex exchange website, or register an account to start trading in minutes.

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