The platform allows users to buy BTC futures through a cryptocurrency derivative asset.
One of the most recognized cryptocurrency exchange platforms in the world, Binance, informed its users that this month the purchase option for a new BTC derivative will be available.
According to the announcement that the platform’s directive issued, the user may buy the derivative digital asset on the platform with US dollars. This BTC derivative will function as a product that will be subject to a liquidation agreement every three months. This project launches a section that the platform hopes to provide to offer investment services through future purchases of bitcoins.
In the same way that futures contracts work, the agreement works as an exchange method in which the user buys the cryptocurrency using dollars or the traditional currency. Once the agreed time expires, the platform releases the corresponding amount of bitcoin with the purchase, and at an established price.
As the exchange company specified, their futures contracts will only last for three months for the liquidation of the bitcoins. In this way, according to the agreement, the contract will expire every last Friday. Binance also highlighted that the level of leverage will be up to 125x in each contract.
To access this type of service, the company explained that the user who wants to make the purchase must access it through the Binance Futures section. The company established this section in mid-September 2019, so it has experience using this tool. Binance commented that, since the creation of this interface, this will be the first future contract service that has a set time for settlement and expiration date.
As an example of this, the platform specified that the first future contracts will have the name of BTCUSD Quarterly 0925. Besides, these contracts will have an expiration date for next September 25th.
In the statement, Binance explained that this project is a solution to the growing demand in the bitcoin futures market, through derivatives. This fact implies that the market is experiencing levels of adoption that the community had not seen until now.
As proof of this, CryptoCompare shared data that determined that the volume of purchase of bitcoin derivatives reached the highest levels last May, registering a growth of 32%, which, according to these figures, represents up to 602 billion dollars only in this market. This clarifies the accelerated growth that the industry has experienced since this year.
Binance has not only started the market for future contracts with bitcoins, but also it had previously launched the option to offer other future contracts with stablecoins. One of the cryptocurrencies that Binance has used is USDT and other tokens with leverage characteristics.
Besides, the platform also offers very short duration exchange agreement services, using the Binance Option. The platform has also introduced valuable tools for those who do business with traders. In this way, Binance is updating its network to include a more complete set of options for all needs and expand the crypto-options for users.
By María Rodríguez