18 September 2023

Leverex's 2021 Transformation: Opening Doors to Derivatives Trading

In 2021, Leverex, founded by seasoned trading professionals, brought a revolutionary change to the world of cryptocurrencies. Their mission was clear: make derivatives trading accessible to all by simplifying its complexities. Traditionally reserved for experts, derivatives trading often baffled newcomers. Leverex changed this by streamlining intricate events such as cascading liquidations, clawbacks, and funding rates.

Leverex's flagship product, rolling Bitcoin futures contracts, traded alongside USDT on the Liquid Network, offers a predictable experience. Their innovative risk model removes the fear of forced liquidations and complex funding costs. What's more, Leverex's simplicity allows traders to start with just 1 USDT, giving newcomers the confidence to venture into the world of crypto derivatives.

Common Derivatives Risk Models: Pros and Cons

Derivatives risk models come with a mixed bag of advantages and drawbacks, making it a nuanced landscape for traders to navigate.

On the positive side, these models provide traders with the flexibility to choose leverage based on their risk tolerance and preferences, enabling them to amplify potential gains according to their comfort level.

However, there's a downside to these benefits. The unlimited potential for gains is counterbalanced by the sobering reality of unlimited downside risk. A single unfavorable move can result in significant losses. Additionally, high volatility in the derivatives market can eat into profits, while limited liquidity can lead to unfavorable executions, potentially increasing losses.

In essence, Leverex recognizes the pros and cons of common derivatives risk models and has crafted a unique approach that seeks to strike a balance. It prioritizes clarity, predictability, and protection against downside risks, even if it means capping the potential for unlimited gains.

Leverex's Approach to Derivatives Trading

Leverex takes a unique approach to derivatives trading that carefully balances advantages and trade-offs. One of its standout features is the assurance it provides traders of a known downside potential. This clarity allows traders to understand their maximum potential loss right from the start.

What sets Leverex apart is its model, which isn't tied to liquidity. This means that traders won't face the risk of unfavorable executions due to liquidity issues. The fee structure is straightforward and predictable, with traders paying a fee when they enter and another when they exit. This eliminates the uncertainty associated with hidden or ongoing costs.

Leverex also provides transparent incentives. It rewards liquidity providers with a share of the fees, fostering transparency and mutual benefit among its users. To further mitigate risks, Leverex offers protection from high volatility, resulting in a more stable and secure trading environment.

However, it's important to note that Leverex's approach does come with trade-offs. For instance, there is a fixed 10x margin for all traders, which limits the potential for significant upside gains. Additionally, traders may encounter slightly wider spreads compared to other derivatives models.

In Summary

In summary, Leverex, established in 2021, embarked on a transformative journey to simplify derivatives trading, making it transparent, predictable, accessible, and simple. With its innovative risk model, transparent practices, and low entry barriers, Leverex aims to redefine the crypto trading landscape. It enables both new and experienced traders to explore the world of derivatives with confidence and ease, embodying a vision of revolutionizing the industry for all.