Crypto Derivatives Platform Vows to Tackle Socialized Losses Seen on Other Exchanges

A crypto futures exchange says its features mean it is well-positioned to solve current problems that exist among rivals.

The team behind FTX claims they were driven to act after "Hours of feedback" to established exchanges about the problems with their products went ignored.

As a result, the company claims that its platform "Reduces the likelihood of clawbacks" through a three-tiered liquidation model - tackling the problem represented by "Significant amount of customer funds on other derivatives exchanges that have been claimed by socialized losses."

In a blog post, the exchange explained: "FTX really does see clawbacks as a worst-case scenario that we hope never happens. We designed a system that we think will withstand huge market moves and huge volume without leading to any clawbacks."

Competitive advantagesFTX says that its backstop liquidity provider system is coupled with universal margin wallets via TrueUSD or USDCoin that enable users to trade all derivatives in one place.

The exchange has also launched leveraged tokens on USDT, BTC, ETH, EOS, XRP with -1, +3 and -3 leverage, allowing users to put on positions that would typically require posting collateral without doing so.

FTX is available hereThe crypto exchange adds that it is backed by Alameda Research, which it claims has become "One of the largest liquidity providers and market makers in the space," trading anywhere between $200 million and $1 billion a day, depending on market volatility.

A summary of its white paper adds: "FTX is designed by people who really know the products. Everything from collateral to maintenance margin to liquidation processes to product listing has been redesigned from the ground up by one of the heaviest users of the products. It is built by traders, for traders."

A token with purposeFTX has issued a token called FTT, which the exchange says offers significant utility to users.

The exchange says its team has a rich background, drawing from Wall Street firms and major tech companies such as Facebook and Google.