Derivatives and Away We Go

[mrob82]

I have had several conversations with people outside the forum, and some on the forum, about price manipulation getting ready to occur like you've never seen.  Might be new to board, but not new to trading derivatives.  People need to be fully aware of the risk that this entails.  You thought people committing suicide because of margin was bad, wait until some of these people start trading derivatives, you haven't seen anything yet.  Some interesting points from the article:  https://cointelegraph.com/news/coinshares-and-bnc-support-new-high-performance-defi-derivatives-exchange

Just a snippet of the basics of the article.....

Leverj, a non-custodial derivatives platform based on an Ethereum sidechain, announced on Tuesday their cooperation with leading industry participants to support the launch and marketing of its exchange.

One of the more interesting theories is that this could be a huge play on ETH.  If ETH is going to be the gateway to trading derivatives through coins, ETH will see massive upside. 

To achieve meaningful performance for trading, Leverj uses its in-house Plasma-based scaling solution, Gluon. The system was optimized specifically for high-performance non-custodial trading. Like other Plasma-based systems, it relies on the security of the Ethereum chain to guarantee the safety of the funds.

One of the smartest aspects of this whole project is that you keep custody of your coins.  With so many issues going on with Paypal and other avenues wanting to act like an exchange, but are surely not - this is a breath of fresh air, especially for new individuals that are entering the market.

The platform expects to onboard crypto traders who wish to trade derivatives without losing custody of their funds.

My whole question surrounding this is that you know companies are going to try to bundle derivatives together in order to provide customers with more options to trade.  In the end, they are making the most off of active traders that will enter and exit positions multiple times a day.  So at the end of the day, are we going to see a 2x or 3x bearish derivative on a coin?  It's going to be interesting, thats for sure.

[Tstar]

I'm always skeptical when I read about "game-changer" exchange over ETH for two reasons:

1) Speed of transaction
2) Fees

Until these are the solution to those two problems, I don't see how anybody could use it for daily trading, e.g. putting significant volume.

[mrob82]

I'm always skeptical when I read about "game-changer" exchange over ETH for two reasons:

1) Speed of transaction
2) Fees

Until these are the solution to those two problems, I don't see how anybody could use it for daily trading, e.g. putting significant volume.

From my guess and the rumblings, nothing concrete, they are going to combine the derivatives against the ETF that's starting up.  It's going to give people the ability to go 100x-1000x volume with less capital.  I.e. who has the ability to trade AMZN stock with huge volume when it's sitting over 3K a share, but give me the ability to control 100 shares for $200-$400 - now I can get the volume and the leverage.  It's just going to be the typical people looking for a fast $$ that are going to get crushed.