FTX Exchange

By
Timothy Smith
Full Bio
Tim Smith has 20+ years of experience in the financial services industry, both as a writer and as a trader.
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Published September 10, 2021

What is FTX Exchange?

FTX Exchange is a leading centralized cryptocurrency exchange specializing in derivatives and leveraged products. Founded in 2018 by MIT graduate and former Jane Street Capital international ETF trader Sam Bankman-Fried, FTX offers a range of innovative trading products, including derivatives, options, volatility products, and leveraged tokens. It also provides spot markets in over 100 different trading pairs, such as BTC/USDT, ETH/USDT, XRP/USDT, and its native token FTT/USDT.

Key Takeaways

  • FTX is a centralized cryptocurrency exchange specializing in derivatives and leveraged products. It supports most commonly traded cryptocurrencies.
  • FTX offers user-friendly desktop and mobile apps with multiple order types, making the exchange suitable for beginners and seasoned professionals.
  • FTX's key product offerings include futures, leveraged tokens, options, MOVE, and spot markets.
  • The exchange recently entered into a sponsor partnership with NBA champion Stephen Curry.

Basics of FTX Exchange

FTX's wide range of products and easy-to-use desktop and mobile trading apps make it suitable for crypto investors of all skills levels, from beginners to seasoned professionals, or in crypto jargon, from newbies to whales. The FTX platform offers a comprehensive range of order types, from basic market orders to more complex trailing stop orders.

As of the third quarter of 2021, competitive trading fees start from 0.07% to 0.04% for futures and spot markets, based on the maker and taker model. Meanwhile, leveraged tokens carry a creation and redemption fee of 0.10% and a daily management fee of 0.03%. FTX supports 10 fiat currencies that investors can deposit and withdraw via a wire transfer: USD, EUR, GBP, AUD, HKD, SGD, ZAR, CAD, CHF, and BRL. FTX doesn't charge deposit or withdrawal fees for crypto assets; however, fiat withdrawals below $10,000 attract a $75 fee.

Traders can sign up to FTX and withdraw up to $2,000 per day with email verification only.

Key Products

FTX's key products include futures, leveraged tokens, options, MOVE, and spot markets.

Futures: Traders can take both long and short bets on leading cryptocurrencies using over 100 quarterly and perpetual futures pairs with margins of up to 101x. Stablecoins, such as USD and tether (USDT), are used as collateral to open and maintain positions.

Leveraged Tokens: FTX offers ERC20-based tokens that provide traders up to 3X leveraged exposure against the underlying trading pair. For instance, if a trader opens a BULL/USD - 3x long Bitcoin token and Bitcoin rallies 10% from the time of purchase, the leveraged token would gain 30%. FTX's leveraged tokens have no margin requirement.

Options: Traders can speculate on future price direction and hedge against their open positions with a range of call and put options that give the holder the right but not the obligation to buy or sell at a future strike price.

MOVE: These contracts allow traders to bet how far the price of a cryptocurrency will move over a time period, irrespective of the direction, essentially making them a play on volatility. As long as the price of the underlying cryptocurrency moves over a specific dollar amount—either up or down—the contract generates a profit.

Spot Markets: FTX offers over 100 different spot trading pairs, providing exposure to leading cryptocurrencies, such as Bitcoin, Ethereum, Binance Coin, Chainlink, and Ripple's XRP.

FTX offers futures pairs with margins up to 101x to long or short leading cryptocurrencies, allowing traders to take advantage of comparatively small price movements.

Regulation

FTX was incorporated in Antigua and Barbuda and is headquartered in The Bahamas. The exchange remains unregulated in the United States, although U.S.-based crypto investors can access partner entity FTX.US—a registered money services business with FinCEN. FTX.US offers a significantly reduced range of products compared to FTX global and also requires more stringent account verification.

FTX Exchange is not regulated in the United States. U.S.-based traders can only access partner entity FTX US.

Celebrity Affiliations

As part of its marketing efforts, FTX recently inked a partnership with Golden State Warriors point guard Stephen Curry, which sees the NBA champion receive an equity stake in FTX.com. The exchange has also agreed to support Stephen and Ayesha Curry's foundation, Eat.Learn.Play. Both parties agreed that the partnership seemed a good fit, given their commitment to philanthropic causes. "FTX is like-minded when it comes to giving back to the community in meaningful ways, and I can't wait to see what we can achieve together," Curry said after signing the agreement.

The high-profile affiliation between FTX and Curry comes less than a month after 18-time FIFA and UEFA champions AC Milan signed a multi-year Bitcoin trading partner and sleeve sponsorship deal with prominent cryptocurrency exchange BitMex. Affiliations between leading exchanges and high-profile athletes continue to gather pace in hopes of increasing widespread adoption and take-up of cryptocurrency trading. 

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