We are working on expanding trading beyond bitcoins. We currently use a contract for difference model to settle option, and are looking to add direct contracts for difference too. The advantage of CFD is traders don't need to own the underlying asset which makes it possible to trade basically anything with a market price.
We're thinking to limit the items we start with to Gold, Euros, and tech stocks like Google, Apple, Amazon, and Yahoo. However, it's possible to include commodities such as oil, wheat, cocoa, sugar etc.
Which items would you like to see?Contract for Difference Example
Gold rises $6.00 to $1594.70 and Bob thinks it's now headed lower. He creates a contract for difference as a Seller for 5 units of Gold at a price of $1590.00.
Bob's offer in the Order Book = Sell 5 Gold oz. @ $1590.00.
Susan thinks gold is headed higher so she accepts Bob's offer.
Susan's offer in the Order Book = Buy 5 Gold oz. @ $1590.00.
The contract for difference stipulates a Seller will pay the Buyer the difference between the contract price and market price at contract time (contracts mature every Friday at 6 pm). If the difference is negative the Buyer pays the Seller.
At maturity the market price of gold is $1600. Bob was wrong on the price direction and would owe Susan ($1600 - $1590) x 5 = $50.
If the market price at maturity had been $1585 (a negative difference) Susan would owe Bob ($1590 - $1585) x 5 = $25.