Perpetual Trading
FWX Perpetual Trading is a decentralized perpetual exchange that enables users to trade a variety of cryptocurrencies with leverage directly from their deposited balance. Built on the Base blockchain, FWX Perpetual Trading offers a decentralized trading experience with the added benefits of very low gas fees. This platform is designed to cater to both novice and experienced traders, providing a seamless environment for high-leverage trading with a robust risk management system.
Key Features
Leverage Trading with Up to 30x
FWX Perpetual Trading allows users to engage in perpetual futures trading with leverage of up to 30x. This means traders can amplify their positions, gaining exposure to larger market movements with a smaller initial investment. The platform supports both long and short positions, enabling traders to profit from both rising and falling markets. The pricing for these trades is dynamic and is derived from the PYTH Network, a trusted source for high-fidelity market data.
Cross-Margin System
To provide maximum flexibility in managing trading risk, FWX Perpetual Trading operates with a cross-margin system and utilizes USDC (USD Coin) as the collateral asset. Users can use their USDC collateral to open and manage multiple positions across different trading pairs, all within the same collateral pool. This allows traders to efficiently manage their risk while maintaining the ability to trade across various markets.
How FWX Perpetual Trading Works
Trading Against Liquidity Providers
In FWX Perpetual Trading's decentralized perpetual exchange, traders open leveraged positions and trade against liquidity providers (LPs) on the platform. The platform operates with a unique dynamic where the liquidity providers act as the counterparties to all trades. This means that every profit or loss a trader incurs is directly tied to the liquidity pool provided by these LPs.
Liquidity Pool: The FWX Perpetual Trading platform is powered by a single-asset liquidity pool, which exclusively holds USDC (USD Coin). Liquidity providers deposit their USDC into this pool, which then facilitates leveraged trading on the platform. By doing so, LPs play a critical role in the ecosystem, providing the necessary liquidity for traders to open and maintain their leveraged positions.
Counterparty to the Trade: As the counterparties to traders' positions, the liquidity providers are directly affected by the outcomes of these trades.
Trader Profits: When a trader makes a profit on a position, the corresponding payout is made from the liquidity pool, thereby reducing its overall value.
Trader Losses: Conversely, if a trader incurs a loss, the loss is absorbed by the trader's collateral and subsequently added to the liquidity pool. This mechanism ensures that the liquidity pool remains robust, and that LPs are fairly compensated for the risk they undertake.
Fees Structure
Liquidity providers earn rewards from the trading activity on the platform through a well-defined fee structure. The fees are primarily sourced from:
Trading Fee: A small fee is charged on every trade executed on the platform, contributing to the overall revenue for the liquidity pool.
One Time Funding Fees In addition to trading fees, funding fees are collected periodically to balance the demand and supply of leverage on the platform.
These fees are distributed among the liquidity providers, rewarding them for their role in maintaining the liquidity and stability of the FWX Perpetual Trading platform. This fee structure incentivizes LPs to continue providing liquidity, ensuring that the platform remains operational and efficient. Read more Fees
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