Why leveraged trading platforms? – pukkamex
Introduction
In traditional markets 96% of trading volume takes place on margin; that is 96% of total volume traded is done on leverage.
Although trading on leverage carries its risks it also opens up new asset classes and with them a whole lot of trading strategies that can be used for speculation and or hedging and ultimately for making money in both bear and bull markets.
As crypto matures we are starting to see volume shift from spot exchanges towards leveraged trading platforms, this shift, as we at pukkamex believe is the natural progression that any asset class goes through as it continues to mature.
Just a few weeks ago bitmex, the world’s largest leveraged trading platform, clocked in a daily trading volume of 14 Billion USD, compared to about 1.5 billion traded on the day on Binance; the worlds larget spot exchange.
This growth in popularity and hence trading volume on done on leverage is no secret, and this is the market the pukkamex aims to exploit.
pukkamex aims to capture a 1% market share in the first 3 years of operation, this equates to about 40 million USD in gross revenue and over 10 million USD in revenue shared with PUX token holders.
Acquiring a 1% market share, albeit the fact that it seems easy on the surface is no easy feat. However, pukkamex offers never before seen features to its users which should give us a competitive edge and help us exceed the targets we aim for, most notable of which;
1- Revenue sharing.
2- Copy trading.
View our copy trading platform in action here.
Revenue share is not the only thing PUX holders have to look forward to; holding the PUX token offers more utility, our mission is to maximize wealth for the PUX token holder, as such we constantly look for ways to reduce supply and create utility and hence demand for our tokens;
1- A one time purchase of PUX tokens worth 50 USD is required to be made by every user who wishes to access the copy trading functionality. These tokens are then permanently burnt and remove from supply.
2- PUX token holders are also insured against liquidation which is made possible via our dual token mechanism; The PUXP (PUX Point) is our second token, which serves as a digital point to award and/or compensate liquidated traders.
3- PUXP is distributed to every single trader if a liquidation is triggered; 1 PUXP is rewarded for each 1 contract liquidated, this is visible via my account page; these points are non-transferable. At the end of every quarter 15% of the increase in the insurance fund’s size is distributed to PUXP holders in BTC relative to their holdings to total PUXP available, at which point all PUXP balances are set to zero.
Leveraged trading for risk management
The introduction of derivatives allows for hedging; hedging is process of mitigating the risk of your digital currencies which you hold from dropping in USD value.
Essentially a trader takes a 1:1 trade to hedge his spot holdings of Bitcoin for example from falling prices. So back in December 2017, assume you held 10 bitcoin; you could’ve entered a 10 btc short position; as the BTC/usd price dropped and you lost USD value on your spot holdings your make the same USD profit on your short position which becomes profitable as the prices drop. Essentialy regardless of where the price heads you maintain or hedge your spot holdings.
Leverage trading and speculation
The introduction of derivatives and leverage allow for traders to speculate on bigger positions and also allow for making traders to profit from bear markets.
When entering a short position you are in affect borrowing and selling bitcoin at a certain price and hoping that bitcoin would drop in USD value in order to use the funds to buy back the BTC and keep the difference in profit. This is called taking a short position. Long positions are essentially making a bet on increasing prices.
Leverage allows you, at an increased risk to your capital, to take on bigger long and short positions than your capital would otherwise handle, which puts you in a position to magnify profits from winning positions.
Conclusion
The shift from spot exchanges to leveraged trading platforms is already happening and pukkamex is perfectly positioned to take advantage.
“In 2016 I moved some of my personal capital into crypto and started trading, I eventually ended up in Bitmex. I hate to admit it, since they are our number 1 competitors but Pukkamex was born after I had a look at their daily volume and thought to myself: ‘shit! it’s happening, in a few years most crypto will be traded on leverage.’”
-Ahmad Sharkatly, CEO- pukkamex https://u.today/offering-more-than-an-exchange-of-coins-pukkamex-looking-to-add-value-for-customers
Published at Sun, 14 Jul 2019 11:58:30 +0000
Bitcoin Pic Of The Moment
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