Published: November 5th, 2020
FTX has launched Bitcoin pairs for some leading stocks, such as Amazon, Apple, and Tesla. This latest addition in the crypto derivatives exchange is an easier way to buy and sell the world's most popular stocks.
FTX, a leading cryptocurrency derivatives exchange, announced on Thursday, October 29, that its users can now register and trade more than 12 crypto and equity pairs. The feature is available in FTX's fractional stocks offering, which the platform referred to as the first of its kind.
These new additions mean that FTX's users can now buy and sell high demand stocks such as Amazon, Apple, and Tesla, represented by tokens, against Bitcoin, Altcoins, and stablecoins. While announcing the new product, FTX CEO, Sam Bankman-
Fried, said the product demonstrates a promising and powerful future where assets are digitized and traders have the unlimited creative potential of expressing their beliefs regarding the markets.
The CEO added that to facilitate liquidity, the tokens will represent a fraction of a share. Therefore, traders will have the opportunity to trade half a share at a time if they so prefer, Bankman-Fried added.
This new product is made possible because of the collaboration among FTX, Digital Assets AG, a capital market solutions provider, and CM Equity, an investment firm.
The CEO said that the fractional stock products are reflections of the realities in today's markets. Traders are scouring the entire bounds of the industry looking for trading opportunities that meet their interests and mindset, Bankman-Fried added.
While the product is innovative, it is not available to traders in the U.S. and other regions where FTX is restricted.
Aside from launching a novel way to trade the world's leading stocks, FTX also announced the unveiling of TixWix. Developed in partnership with Hxro (pronounced Hero), the product targets retail crypto traders who it hopes will benefit most from this simplified options product.
According to the announcement, the product targets a global retail audience of crypto options traders by refining complex data. The tool relays the data in a format that everyone using other predictions and betting platforms for sports and politics will find familiar, added Hxro CEO Dan Gunsberg.
Hxro is not to the cryptocurrency scene. The company came into the market in March 2019 when it launched a gamified binary futures tool called MoonRect. The premise behind MoonRect is to transform normal gaming behavior and ramp it up with both excitement and real money prizes.
In the beginning, the platform had a single game where users placed bets on whether Bitcoin's price would MOON (go up) or RECT (slump) over five-minute intervals. The company is popular with cryptocurrency users. Its inaugural tool was launched to a waiting list of more than 35,000 users.
Hxro's new product relies on FTX's backend expertise and infrastructure to supports its options trading interface that takes away, among other things, complexities around the Greeks and complications of non-linear risk factors. Gunsberg said the above complexities refer to the four standard measures of risks that apply to options traders that are delta, theta, gamma, and rho.
Rob Levy, Hxro's co-founder, added that instead of presenting the options in complicated contracts with a 5% chance of expiring after a given price shift, TixWix supplies the same trade as a simple bet with odds ranging from 20 to 1.
The new tool supports Ether and Bitcoin markets and will present users with two bets. The two, according to the CEO's statement, are Tix and Wix. Tix is a bet chancing that an asset's market will close above a specific price at a given time. And, Wix is a bet that the price of the same asset will get to a specific price at some time before the set expiry date.
The collaboration between FTX and Hxro is the first instance where the former provides backend support for such a venture. Bankman-Fried said that his firm already has adequate experience in betting and prediction markets.
However, the FTX CEO clarified that his exchange's experience is limited to its increasingly popular markets on the U.S. presidential election. Bankman-Fried added that the election's oversubscribed nature and the record volumes witnessed ahead of the November 3 event has stamped the exchange's authority and ability to handle any similar situation.
In an interview, Levy said that TixWix is a gamble by both Hxro and FTX teams on the anticipated growth of the cryptocurrency options market.
He added that the massive upside of options trading tools in the cryptocurrency space heightens the importance of options. The amount and value of options traded in traditional markets is the reason why Levy thinks their significant growth in the cryptocurrency space is unstoppable.
He said that the explosion of equities and commodity options witnessed in the legacy markets would quickly replicate the cryptocurrency sphere. Liquidity is essential in facilitating such a giant wave. And, the cryptocurrency markets are already seeing such necessary liquidity trickling in, Levy said.
With the cryptocurrency options markets gearing for an enormous increase, Hxro and FTX are partnering to make the space opportunities easily playable even among novice traders. The statement issued during the launch of TixWix said that live streaming simplified market odds is just one of the many innovations that the collaboration is working on to improve crypto markets.
Launching a new way to trade the world's most popular stocks and presenting the market with a tool for simplifying the process of playing crypto options markets may catapult the collaboration between Hxro and FTX and make the major players in the crypto space in several years to come.
FTX, a leading crypto derivatives exchange, has launched Bitcoin pairs for popular stocks such as Amazon, Apple, and Tesla. Aside from the novel trading model, the exchange has collaborated with Hxro to unveil a tool that will allow users to play crypto options.