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Introduction of FWX

What is FWX

FWX is a fully decentralized derivatives platform where users trade against the protocol. However, the protocol employs the Automated Position Hedger (APH) mechanism, an automated market maker (AMM) for futures, to fully hedge the risk of all positions on-chain using liquidity from its pools. In other words, the protocol acts as the counterparty for all users but is not exposed to the risk associated with traders' profit and loss, thanks to the unique automated hedging strategy implemented as a smart contract.
There is no limit order book on FWX as the protocol, and traders can take both short and long positions at the spot price of the underlying, accounting for slippage. The process of listing futures for trading on FWX is permissionless and straightforward, requiring liquidity provision for the listing tokens and stable coins. Crucially, liquidity providers do not experience impermanent loss.

Key Features

Derivatives Trading

FWX offers completely trustless trading, with all transactions, including position handling and liquidating, taking place on-chain for utmost transparency and security. User funds are securely held in a smart contract.
Notably, FWX operates solely with market orders, as it acts as a counterparty to all futures traders. The platform implements a unique hedging algorithm utilizing liquidity from its single-token lending pools, effectively eliminating risk and ensuring deep liquidity for users.
FWX is currently focused on futures trading as its main feature, with plans to introduce more complex derivatives like vanilla call and put options and exotic derivatives in the next version.

Lending and Borrowing

FWX provides "REAL" yield to liquidity providers through organic interest from borrowers and trading fees. The protocol uses tokens in the lending pools to hedge trading positions, generating natural borrowing demand. This addresses the issue of imbalanced lender-to-borrower ratios seen in other platforms. Higher trading volumes lead to increased yields. For instance, with a daily volume of 500k USD, FWX can achieve at least a 20% organic yield for a 5m USD pool. Notably, the yield paid to lenders is sustainable as it remains in the same currency as the funds lent in the pools, preventing inflation of the governance tokens.

Membership NFT Cards

FWX utilizes a non-fungible token (NFT) as a comprehensive membership card, encompassing all user activities within the platform, including lending, borrowing, and trading. Whenever a transaction takes place, the NFT membership card gets automatically updated. This approach ensures user convenience during wallet migration, as the membership NFT can be seamlessly transferred.
Moreover, users will soon have the option to stake FWX tokens in their NFT membership card to unlock enhanced privileges, such as higher lending APYs and lower trading fees, among other benefits.

What makes FWX Unique?

Cheapest Fees

The taker trading fee on FWX is exceptionally low at 0.03%, making it the most cost-effective option among decentralized platforms. Moreover, the strike price of a futures contract is set equal to the current price of the underlying asset. This feature allows traders to take both long and short positions at the underlying asset's price, considering potential slippage. This can prove advantageous, as futures bid and ask prices may not always be as favorable as those in the spot market.

Real and Sustainable Yield

FWX offers organic and sustainable yields paid in the same currency as the lent funds, preventing inflation of governance tokens. These yields originate from interest on loans taken on the platform and trading fees. 20% of the trading fee is distributed to the liquidity providers as the liquidity in the pools is actively used to facilitate trading. With a pool size of 5 mUSD and a daily trading volume of 1 mUSD, the organic yield can reach at least 40%.

Enhance Trading Experience

NFT membership cards make your trading more enjoyable. Users can trade their card with benefits on it as it is NFT. Your trading experience will no longer be the same.

Experience Permissionless Listing (Coming soon)

FWX stands apart from other derivatives platforms as its listing process is permissionless, allowing anyone to list tokens for futures trading without seeking permission. This is possible because FWX functions as a market maker, assuming all trading positions. Listing is straightforward—providing liquidity of the tokens and stable coins to the platform. The only prerequisite for futures listing is that the tokens must have spot trading on decentralized exchanges.

Our Vision

FWX envisions a trustless financial system for all, driven by principles of security, simplicity, and sustainability.
Last modified 2mo ago