Digitex - Building A Better Future
Building A Better Futures Exchange
For many of us, one of the most exciting parts of the cryptocurrency space is making a smart trade with a high ROI. However, our profit margins, and in some cases the existence of profits, can be hindered by transaction fees. We accept these fees as a reality of the market, a necessary evil due to how most popular exchanges today are centralized and require profits in order to maintain the software and hardware required to provide their services. The irony behind this being that many of us got involved in crypto in the first place because we wanted a store of value that was immutable and fully owned and controlled by the only bank we trust, ourselves! Unfortunately, as money trickles into these centralized exchanges, we're not only relinquishing our ownership of our assets but we're also stuck paying fees to use a platform that connects us to other buyers and sellers. So we've effectively switched from working with banks using fiat to working with private organizations using crypto, when we'd really rather minimize the presence of a middleman altogether. What we really need is the ability to retain ownership of our crypto assets while still having the ability to trade futures contracts with no fees. This is where Digitex comes in!
Digitex is introducing the concept of a commission free exchange with decentralized ownership of private keys. Built upon the Ethereum blockchain, it uses smart contracts to allows the exchange to track balances of users to facilitate trading while the traders retain ownership of their private keys. Currently, it is scheduled to have 3 futures that can be traded, Bitcoin, Ethereum, and Litecoin. This is made possible with the DGTX token that users must leverage in order to trade futures contracts. This environment creates two distinct and significant advantages over other futures exchanges. First, it removes pesky transaction fees, allowing you to trade more volume with fewer ticks if desired. Secondly, because you continue to own your private keys, your funds cannot be stolen or lost by the exchange. Let's take a closer look at these two primary benefits.
No Transaction Fees
Instead of charging fees for each trade like all the most popular exchanges do currently, Digitex allows users to leverage their DGTX token for trades without charging any fees. This means, all you have to do is own DGTX tokens in order to trade futures contracts. All profits and losses impact your DGTX balance. The reason they're able to do free trades is because after 2 years, they will enable small amounts of DGTX tokens to be created to fund the exchange that will be determined by a democracy of DGTX holders. Since users need DGTX in order to trade, the demand will grow in congruence with the popularity of the Digitex exchange. This creates an economic system that allows the Digitex exchange to remain financed without creating a large enough burden in supply to ruin the value of the DGTX tokens. A user can simply purchase DGTX tokens, make their trades, and then either continue to leverage their DGTX in future trades or sell them if they wish.
It may seem obvious that no trading fees are beneficial, but it becomes more clear how important this is when you look at a real world scenario. The Digitex whitepaper does a great job of providing a couple detailed examples, below are the results from one such example. You can clearly see how Digitex comes out ahead of other exchanges, but if you read between the lines the real moral of the story is not only that you can save money on fees, it's that you can make trades with Digitex that you simply cannot on other exchanges. The example below comes from a small price tick of $10,700 to $10,720 BTC price. As you can see, on GDAX (Coinbase Pro) you would lose money doing this trade. Another way to think of this, it may be easy to predict a small $20 increase in price to take a small profit, but as that price increase grows, the certainty that it will reach the price increase is much less likely. Being able to make a profit off of very conservative and small margins is of vast value to a futures trader, and not something that can easily be done profitably with other exchanges today.
Decentralized
From the very start of Bitcoin, one of the most desired attributes of cryptocurrencies is simply having true ownership of your assets. This is something that traditional markets tend to not offer. Like many of you, I invest in a 401k program through my work. This is a common practice and it works just fine... until it doesn't. The fact is, you don't hold any of the assets or money attributed to your account, the organization that manages it does. If they mess up, get hacked, go bankrupt, or if the market turns, that money could disappear. The reason that I also invest in cryptocurrencies such as Bitcoin is because I want to make sure that when push comes to shove, I do have assets that I fully own and have access to. If you only want to hold and own some bitcoin, it's become quite easy to do. You only need to purchase some either via an exchange or from a private party and then transfer it to a wallet. However, many of us enjoy making trades to try and increase our balance. There are many exchanges that do this, but until the Digitex exchange is released, it remains impossible to retain secure ownership of private keys and complete these trades without transaction fees.
Another small but important note on decentralization, Digitex also uses decentralized governance to dictate when new tokens are generated and how many new tokens are generated. This ensures that token generation is in the best interest of the platform and decided democratically by stakeholders. This is important because it alleviates any concerns you may have with the Digitex team as the responsibility of token generation is on the stakeholders instead.
Video Summary
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How Can I Be Involved?
If you trade futures or are interested in doing so, I'm sure you're rather interested in how you can get involved with this revolutionary new project. There are a few things you can do right now. First off, join the telegram group to see the latest updates to the project and to ask any additional questions you have about the project. Secondly, you can sign up for early access to the platform. If you want to move up in the line of users requesting access, you can do so by recruiting more people to sign up. Lastly, pick up some DGTX tokens today so you'll be ready to roll as soon as the exchange, launching in Q4 of this year (2018). Tokens can be found on the exchanges listed on their website here.
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