Are Cryptocurrency the new Derivatives

Cryptocurrency the new Derivatives



     “A product whose value is determined by an underlying asset.”

Some example of derivatives are:

Currencies, exchange rates, commodities, stocks, and the rate of interest. 

The buyer and seller of such contracts opposed predictions for the future trading price. Both parties estimate the price for future profit 

Derivative trading in Techpay:

” In Techpay, derivatives trading can be any cryptocurrency token. Two parties or  organizations that made a  financial contract suppose on the Techpay  price on a future date.”

During the initial phase of the contract, the sides agree on a selling/buying price for Techpay  on a specific day, regardless of the market price.

 Therefore,  investors  of the contract can profit from changing the  asset’s price by purchasing the currency at a cheaper price and selling it at a higher price.

How big is the derivative market in techpay?

 The Techpay  derivatives market’s trading volume for the third quarter of 2020 was $2.7 trillion, based on data from 42 exchanges. The Techpay market exchange industry report.  This marks a 25.1% increase from the previous quarter and a year-on-year 159.4% increase from the third quarter of 2019, this shows the  big growth of Techpay over last year. 

  • The volume increase of Techpay is 100%, while its price rose to $0.5019 from $0.2927.
  • The opening price of TechPay on 11 March 2022 was $0.12, with 24 Hour high and 

low values of $0.4238 and $0.12

  • A closing of $0.4232. 
  • The volume of TechPay on 11 March 2022 was $175,542. 
  • The increment is +200% in TechPay from the last 24 hours, which is extremely impressive.
  • Techpay coin Solana (SOL)has market cap is $44.5 billion
  • TechPay Coin is the native coin of the Techpay Chain, which is a highly scalable. its price reached $0.83, equal to a rise of more than 13,700%. Layer-1 Proof of Stake network with pBFT and DAG Consensus.

Moreover,  Blockchain technology of TechPay Coin has 300,000 TPS (Transactions per Second) and a Duration Completeness of under 1.15 seconds.

On 11 March 2022, TechPay coin was listed with LBank exchange. TPC’s listing on LBank Exchange will surely assist it in expanding its operations and attracting more market attention.

Popular types of derivatives in cryptocurrency of Techpay

Depending on the condition of contract, Crypto derivatives can be of the following types:

  • Future contract 
  • Options contract 
  • Perpetuates contract
  • Swaps contract 

Futures contract:  “A  legal agreement between two parties to purchase or sell an asset at a specified date and price  in the future is a future contract.”

  The contract is directly accomplished on a regulated exchange.

Options contract: In option contract, a trader  has the choice, but not the duty, to purchase or sell an  asset at a fixed  date and price in the future. 

Perpetual contracts: Unlike other contracts,  perpetual contracts have no settlement  or expiration date. Under some conditions  (e.g. the account holds a certain amount of a crypto etc.), traders has keep continually their position.

Swaps contract: According to a predetermined formula, a contract between two parties to exchange cash flows at a later date.

 They are over-the-counter contracts.  Derivative trading features

Some derivatives trading features are following: 

  • Auto deleveraging 
  • Loss profit 
  • Incomplete orders
  • Insurance fund

Auto Deleveraging (ADL): When a position cannot be clear  at a price that is better than the legal price and when:

there is insufficient insurance to cover the contract loss

 Crypto (Techpay) exchange’s ADL system will automatically reduce  an opposing position from a designated trader in the case of termination.

Loss Profit:  Allows traders to control price and specify the floor for an order.

when conditions are favourable, allowing the traders to exit the market automatically 

Incomplete Orders: when traders  continue to benefit from the growing market , reject them to take partial gains by partially closing their orders.

Insurance Funds: Helps traders preserve their funds from auto-deleveraging when  their holdings fall below the maintenance margin level. 

Advantages of using derivatives

Advantages of using derivatives are following:

  • Low cost of transaction 
  • Use of derivatives in risk management
  • Price 
  • Efficiency in market 
  • Transfer the risk 
1.Low cost of transaction: Since derivative contracts are risk management instruments, Derivatives can help to reduce market transaction costs. Therefore, the cost of Techpay transactions in derivative trading is cheaper than others. 

2. Use of derivatives in risk management:  Derivatives contract are risk management instruments 

The price of the techpay crypto coin  has a direct relationship with the value of a derivative contract.  Utilization of derivatives changes  the asset prices.

 3. Efficiency in market : Derivative trading emplicate the practice of arbitrage(the simultaneous purchase or sale of the price).

It is critical to find market equilibrium and that the prices of the underlying assets are accurate.

It determines an underlying asset’s 

4. Price:   To determine the price of an underlying asset, a derivatives contract is frequently used. 

5. Transfer the risk : Derivatives allow investors, corporations, participants of a network and other parties to shift risk to others.

Where to possible trade crypto (techpay) derivatives?

Derivatives in techpay  cryptocurrency can be traded on both centralized and decentralized exchange platforms. Techpay cryptocurrency derivatives traded in decentralized plateform. It can be used by exchange owners to reach out to additional investors of trading. A Techpay crypto derivative trading platform is more flexible than others and gives  access to markets that are  inaccessible. 

 Crypto Derivatives Different from Techpay Crypto Markets 

Cryptocurrency derivatives is a  unrelated development to crypto trading at numerous exchanges. 

 Direct bearing on cryptocurrency markets in two ways:

 Techpay cryptocurrency derivatives trading volumes for coins other than bitcoin.  Grayscale has also added Techpay  to the list of cryptocurrencies supported by it. A broader approach to Techpay crypto markets  will raise awareness of alternatives. 

When they have pumped money into Techpay , have largely shied away from other cryptocurrencies.

Techpay  had trading volumes of $8.3 billion

Institutional and regular investors investing through derivatives is  comfortable with Techpay cryptocurrencies and generate cash extract into their markets. 

Result in less volatility in their prices. 

Read also :A guide to high-ground benefits of cryptocurrency ?

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