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FTX Review: Institutional grade crypto trading is now available for retail investors


FTX is one of the fastest growing fintech institutions in the world and is one of the most promising blockchain-based trading platforms in 2021. We will take you through what FTX is, its key features, and how it operates so that you can be up to speed on this exciting new company.

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The FTX platform enables leverage of up to 101x, as well as unique derivatives such as MOVE contracts, OIL futures contracts, cryptocurrency indices, and prediction market tokens.

There are a number of additional features that make it suitable for both high-frequency retail traders and big banks, as well as institutional traders. Deep liquidity, fiat transfers, limitless withdrawals, and an OTC desk appeal to both high-frequency merchants and huge institutions. 

Despite its youth, FTX is growing at a breakneck speed and continues to develop new trading instruments and tokens, which should help it establish its own niche in a highly competitive market sector.


Pros

  • Advanced trading features
  • Low cost trading
  • Mobile app available
  • Hold and stake FTT token

Cons

  • Futures and derivates market may be advanced for beginners
  • FTT token not available in US
  • Expensive withdrawal fees


What is FTX Exchange?

The FTX Exchange is a major centralized cryptocurrency exchange that specializes in derivative and levered products. Sam Bankman-Fried, a MIT graduate and formerly an international ETF trader at Jane Street Capital, founded the firm in 2018. FTX offers a variety of distinct trading possibilities, including derivatives, options, volatility products, and leveraged tokens. It also has spot markets in more than 100 different trading pairs, such as BTC/USDT, ETH/USDT, XRP/USDT, and FTT/USDT, it’s own native token.

The exchange has a solid network to rely on, with a number of prominent crypto venture firms as investors, including FBG Capital, Greylock Partners, Kenetic, and One Block Capital.

The team behind FTX is equally open about their identities and has made their names and LinkedIn profiles readily available. FTX Trading LTD, a company incorporated in Antigua and Barbuda with offices in Hong Kong, owns the exchange.

The exchange has generated a significant amount of positive sentiment among the crypto trading community and already boasts high daily trading volumes. This is quite impressive due to the relative youth of the platform, and it is one of the primary reasons why the FTX community has continued to grow at a rapid pace.

Features

As a new crypto derivatives trading platform, FTX has been gaining users at an accelerated rate by offering a variety of sophisticated trading features.

The exchange has also been the first to introduce a number of unique and cutting-edge trading instruments such as leveraged tokens and MOVE contracts, which have helped to distinguish FTX.

Futures

FTX has quarterly and perpetual futures on over 20 popular cryptocurrencies such as BTC, ETH, BNB, and LINK. Traders can take both long and short bets on these 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.

The exchange also offers Index Futures, which allow users to trade various aspects of the cryptocurrency market with ease. Large-cap coins, mid caps, and small caps are examples of this type.

Leveraged Tokens

The platform offers up to 101x leverage, although as a safeguard, all accounts have a maximum leverage of 10x by default. The exchange also has over 45 leveraged tokens accessible for trading, which makes obtaining leverage rather simple. BULL and BEAR tokens automatically balance their risk and rebalance on a daily basis to maintain their target leverage and prevent liquidations.

Exchange allows for three times leveraged exposure against the underlying trading pair using ERC20-based tokens. For example, if a trader opens a BULL/USD – 3x long Bitcoin token and Bitcoin rises 10% from the time of purchase, the leveraged token would rise by 30%. There is no margin trading requirement for FTX’s leveraged

Options

Traders may wager on the future price trend and hedge their open positions by using a variety of call and put options.

In general, option contracts allow the exchange of “the right” to buy or sell an underlying asset at a specific price by a certain time/date, and FTX’s options may be tailored in a number of different ways.

MOVE 

These contracts enable traders to wager on the price of a cryptocurrency moving up or down over a time period, regardless of the direction, thus making them plays on volatility. The contract generates profit as long as the underlying cryptocurrency’s value moves above or below a certain amount—either up or down—at any moment during its duration.

Spot Markets

FTX offers over 100 different spot trading pairs, providing exposure to leading cryptocurrencies, such as BTC, ETH, LINK, FTT, and more are available.

Prediction Markets

In January 2018, FTX launched a prediction market feature where traders can take positions on future price movements of various cryptocurrencies. Traders receive payouts if their predictions are correct.

How secure is FTX?

FTX has taken extensive measures to ensure the safety of user funds and data by deploying BitGo’s multisig wallets and cold storage for over 95%% of their funds.

The exchange has also introduced multi-platform support and employs over 20 firewalls as well as DDoS protection to ensure that users can trade securely 24/7.

They have also committed to maintaining 100% reserves, which enables the exchange to pay back user funds upon liquidation if necessary.

In addition, FTX also offers a cold storage vault where users can safely store their funds offline.

How to get started with FTX?

Users can deposit, withdraw, and exchange cryptocurrencies as long as they have verified an email address, phone number, and identity card. The registration procedure is straightforward and comparable to that of other cryptocurrency exchanges.

Go here to create your FTX account

  • Click on the “Register” tab at the top right of the home page.
  • Fill in the name and email address.
  • Generate a password. 
  • Complete these fields and click on “Sign Up” in the pop-up registration window.
  • Check the email inbox for a confirmation email.
  • Verify email address with 2FA. 
  • Click on “Account Security” and select Google Authenticator or SMS for authentication.
  • Deposit funds and get a maximum withdrawal limit of $1,000 prior to the KYC verification.
  • Click on the “Settings” tab and complete the KYC verification process to get higher withdrawal limits.

Deposit and withdrawal options

Despite being a relatively new entrant to the digital asset trading sector, FTX supports the deposit, trading, and withdrawal of an impressive number of fiat and digital currencies. Anyone interested in depositing and withdrawing fiat can currently do so in the following currencies:

  • USD
  • EUR
  • GBP
  • AUD
  • CAD
  • CHF
  • HKD
  • SGD
  • ZAR

The exchange also accepts credit card deposits.  

There are no fees for cryptocurrency deposits or withdrawals because FTX reimburses the blockchain withdrawal costs. However, there is a $75 fee for fiat withdrawals below $10,000, while all other transfers are free of charge.

You can make a fiat deposit or withdrawal from your FTX wallet and selecting whichever fiat currency you prefer. You can also convert other fiat currencies to USD by using the ‘CONVERT’ button within your FTX wallet which will see your chosen fiat currencies being converted into USD stablecoins.

FTX Fees

When using FTX there are no deposit or withdrawal fees, and there are also no fees on futures settlements. OTC trading or trading from within your wallet is also fee free as all costs are built into the price you are quoted.

Leveraged tokens have creation and redemption fees of 0.10%, and daily management fees of 0.03%. If you choose to use leverage of 50x your trading fees increase by 0.02% and opting for 100x increases your trading fees by 0.03% which is paid into the insurance fund.

It’s worth noting that the fees for MOVE contracts depend on the price of the underlying index, and not the price of the MOVE contract.

FTX operates the following tiered fee structure for all futures and spot markets:

FTT token

The exchange’s ecosystem utility token is the same as other cryptocurrency exchanges. The FTT crypto token allows users to enjoy discounts on FTX trading fees and socialized profits from the insurance fund. The team conducts buy-backs and burns coins equal to:

  • 33% of all fees generated on FTX markets
  • 10% of net additions to the insurance fund (‘Socialized Gains’)
  • 5% of fees earned from other uses of the FTX platform

The FTT token isn’t available in the United States.

FTX.us vs FTX.com

There are two exchanges named FTX. FTX.us is available in the US and FTX.com is available globally. The original FTX is not available to US citizens due to strict regulation. differing regulatory requirements in differing jurisdictions.

Customer support

The customer experience on the platform is excellent. The platform has a technical and operational team that is both skilled and experienced. FTX Customer Support, which is managed by trade experts, offers several tools to help traders increase their earnings.

The FTX blog section is also a good place for novices to learn more about trading. It contains in-depth articles on using the most up-to-date trading methods. A YouTube channel run by FTX provides instructional videos.

Who should use FTX?

When looking at the range of products and services on offer, it’s quite clear that FTX isn’t aimed at beginners. Products such as Bitcoin options, leveraged tokens, perpetual swaps, and MOVE contracts take some time to understand and do not suit people that are at the start of their trading journey.

The FTX.com website is clean, intuitive, and straightforward to use, guiding you smoothly through the process of signing up for an account. The exchange also features a strong security policy that protects your wallet with industry-leading technology solutions.


FTX Compared

FTX Review: Institutional grade crypto trading is now available for retail investors 8

Uphold


Note: Trade more than just crypto (stocks, crypto, precious metals)

Rating:

FTX Review: Institutional grade crypto trading is now available for retail investors 9

FTX Review: Institutional grade crypto trading is now available for retail investors 10

Crypto.com


Note: Great exchange for beginners that want low fees

Rating:

FTX Review: Institutional grade crypto trading is now available for retail investors 11

FTX Review: Institutional grade crypto trading is now available for retail investors 12

Kraken


Note: wide variety of tradable assets you can choose from

Rating:

FTX Review: Institutional grade crypto trading is now available for retail investors 13


Final thoughts

As a relative newcomer to the cryptocurrency exchange sector, FTX has managed to hit the ground running and has rapidly established its presence as one of the safest and full-featured exchanges available.

A large number of cryptocurrency exchanges only support a handful of trading pairs, which is usually composed of the big-name cryptocurrencies such as BTC and ETH. FTX gives users access to an impressive range of instruments and markets and also offers innovative products such as perpetual swaps and leveraged tokens that give traders the chance to take advantage of price fluctuations

Its feature set stands out from many other crypto exchanges offering an intuitive interface, decent liquidity, and support for a wide variety of altcoins.

The developers also work on improving the functionality of the exchange and keep user feedback in mind when doing so which is something that is definitely appreciated by traders, especially if it means more features can be added without compromising security.

We believe this is ideal for experienced traders that want more opportunity to act on price volatility, which is why FTX receives our stamp of approval.

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