DGTX: Your Gateway to Free Trading
There are more than 500 cryptocurrency exchanges out there with more and more cropping up all the time. There are also plenty of new entrants in the cryptocurrency derivatives space. Amid rising competition and a BTC futures market set to get parabolic, many people ask why we need another crypto futures exchange. Well, the answer is because Digitex is not just another crypto futures exchange and DGTX is not just another exchange token! Read on to find out more.
Digitex Futures is gearing up to make a grand entrance in the market with our unprecedented zero-fee futures trading platform. This means that, for the first time, short-term scalpers and day traders will be able to be as active as they want, in turn, producing highly liquid markets.
Everyone trading on the Digitex Futures exchange must trade in our native DGTX token. We’ve explained previously how the DGTX tokenomic model will support the trading platform's ongoing operating costs - and without penalizing our most active traders. This is the core difference between DGTX and other exchange tokens.
But there’s another critical difference.
How Exchange Tokens Are Used to Reward Exchanges
Exchange tokens, whether we’re talking about Binance coin, OKCoin, or Huobi Token, all work in approximately the same way. The more of the exchange tokens you own, the more you can get discounts on fees. These discounts get even bigger, the more you trade.
It sounds good in principle, right? You’re an active trader, you’re being rewarded with lower fees! But the exchange is milking far more money from these active and loyal traders than it does from the casual one-time buy-and-HODLer.
Let’s look at OKEx and it’s OKB token. OKB tokens are only good for a fee discount if you’re trading below a certain threshold. The exchange calls this band “normal users.”
Normal users on OKEx have to hold over 500 OKB tokens to qualify for the first tier of discounted fees. For most of the last month, OKB has been trading at $2.60 or thereabouts, so you have to tie up around $1,300 of funds - that you can’t trade - in OKB just to qualify for a reduction in taker fees from 0.075% to 0.072%.
So with your fee discounts from holding 500 OKB, you buy $10,000 worth of BTC futures contracts at a price of $10,000 with 10x leverage, meaning that you put down $1,000 in margin. The price goes up and you sell at $10,020, giving you a profit of $20.
Taker fees on that trade without your OKB-hodler discount would be $7.50 on entry and $7.65 on exit which is a total of $15.15. With the discount, it’s $7.20 and $7.34 which is $14.54. So a saving of $0.61 in fees, against your investment in OKB which is $1,300.
Apart from the negligible benefit of holding OKB tokens, lets just consider for a moment the effect that a mechanical edge of that particular size working against you will have on your trading. When you make a profit of $20 as in the above example it is reduced down to a profit of $5.46 after commissions.
But when you lose $20 it is magnified to a loss of $34.54 after commissions. If you win half the time and lose half the time then your results will look like this: win $5.46 , lose $34.54, win $5.46, lose $34.54, win $5.46, lose $34.54 etc.
How can anybody possibly hope to beat a mechanical edge like that? If you’re a short term momentum trader hitting bids and lifting offers, thus incurring taker fees on most of your trades, then you literally have zero chance of being a winning trader. You’ll get better odds at the roulette wheel where a mechanical edge of only 3% (37 numbers on a wheel with a payout of only 35 to 1) ensures that the house always wins. Even the tiniest mechanical edge working against you will make your life very, very difficult.
We’ve picked on OKEx as an example, and the above example also assumes that every trade you do is a Taker trade which might not always be the case, but it serves to illustrate that exchange tokens only really exist to line the pockets of exchanges - they aren’t really offering any meaningful discounts to traders.
OKEx doesn’t even offer any further discounts once you have above 2000 OKB. After the maximum discount at that level, you have to be trading over 1,000 BTC per month on the spot markets, or 5,000 BTC per month on perpetuals to qualify for any further discounts.
Digitex (DGTX) Will Offer Real Rewards
On the Digitex platform, yes, you will be required to hold DGTX to participate in trading. But every single red cent of that DGTX will be available for you to trade.
With so much innovation in the space, still, no other crypto futures exchange has done this. They continue to use the same liquidity-stifling model of transaction fees that’s been in place for over a century. But the problem with charging commissions on trades, particularly when it comes to cryptocurrency futures, is that you punish the most active market participants.
Even with these so-called rewards, existing exchanges actually deter short-term scalpers from entering and exiting positions because they’re still crippling them with commissions. All the most traded futures exchanges follow this same model, albeit with slight variations.
On top of allowing scalpers to make a living without paying commissions, we actively reward them by having automated market makers that are programmed to lose. Rather than having an insurance fund that builds up and up, we propose keeping the fund at the same level and giving excess DGTX tokens to the market makers to lose.
This means that traders on our platform can pursue trading strategies that are targeted at the market makers' losses. In short? We reward the most active traders by actually giving them a mechanical edge in their favor. And just as a tiny edge working against you can cause havoc with your results, then just the tiniest edge working in your favor can produce incredible results.
And our token has actual utility, that isn’t about lining our pockets.
So, when we say we’re a crypto futures exchange with a difference, we really aren’t exaggerating.
We’re extremely grateful to the 1.5 million people who have signed up to our waitlist so far and encourage you to sign up as well if you haven’t already. You have a shot at earning 50K free DGTX for referring friends and can find out more about the project at the same time. Join us in revolutionizing trading.