The DeFi platform dXdY provides its users with perpetual contracts with Bitcoin. The decentralized platform Futureswap offers leverage on Ether of up to 20x.
The launch of two new markets for perpetual futures contracts with the cryptocurrencies Bitcoin (BTC) and Ether (ETH) was announced on April 20th.
The decentralized finance (DeFi) lending platform dXdY enabled the trading of any non-Ethereum-based asset, in addition to Bitcoin. Even though the option was already available as early access, users can now interact with this new feature.
Perpetual contracts with BTC and USD Coin (USDC) will offer leverage on BTC of up to 10x, with no expiration date, and with settlement and margin in USDC. In this sense, one of the characteristics that dXdY highlights is that this market will separate from the existing spot markets on the platform.
A perpetual contract is a special type of futures contract that does not have an expiration date. The user can hold a position for as long as wished, and the contract price uses an underlying index price. This measure is based on an average price calculated according to the main spot markets and their relative trading volume.
In this case, dXdY uses MakerDAO BTCUSD Oracle V2 to find out the index price. For the calculation of the index, it is also important to take into account the exchanges Binance, Bitfinex, Bitstamp, Coinbase Pro, Gemini, Kraken, and Bittrex.
In this way, instead of creating a BTC ERC-20 token, the dXdY team decided to generate a new protocol for their trading margin product, as the team explained. The smart contracts for this product are open source and were implemented on the Ethereum mainnet.
Leverage on Ether up to 20x
Last April 20th, the decentralized exchange FutureSwap was launched on the Ethereum mainnet. The exchange allows users to purchase ETH futures contracts with leverage of up to 20x. Futureswap is integrated into Chainlink to offer all the price indices that users need.
FutureSwap (FST), the native token of this platform, works as an underlying government token that allows any user to propose new exchanges or updates in the system. Users can add any ERC-20 token to the platform through a governance vote.
Apart from having a governance role in the system, the token also plays an incentive role, since it is possible to obtain it by interacting with the platform. All Futureswap participants get the token, depending on their weekly trading volumes. FST serves as an incentive for trading, but it also allows discounts of up to 30% on trading rates.
The fact of having settlement providers is another relevant feature of the platform. All exchanges that users make on the platform have stablecoin and ERC-20 token reserves. Users must deposit the same value in both currencies so that they can become settlement providers on the platform.
This is not the first time that perpetual futures contracts have been used in the ecosystem. Last February, BitMEX added perpetual Ripple (XRP) futures contracts with Bitcoin to its financial products, which means that the said niche of the market is growing.
By Alexander Salazar
