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KuCoin has just launched a platform offering IDG-based crypto-derivative exchanges.
Announced Monday, the KuMEX trading platform is now in the public beta phase and will initially offer an unlimited-term US dollar-denominated bitcoin (XBTUSDM) contract with leverage up to 20 times higher.
In order to make the prices "fairer and more rigorous," said KuCoin, KuMEX uses a bitcoin spot index providing a volume-weighted average of the US bitcoin price on six exchanges: Coinbase Pro, Bitstamp, Kraken, Kraini , Gemini, Liquid and Bittrex.
The spot index also avoids the liquidation of a contract "because of the low liquidity of the trading platform or the sharp price fluctuations of one or two spot markets," the stock market explained.
KuMEX offers some protection against risks thanks to a so-called "totally transparent" insurance fund, the balance to be disclosed every day on the platform.
"This fund ensures that investors who are forced to close their positions do not lose more than their positional margin," announced the announcement.
If the insurance fund proves insufficient to cover the losses, KuMEX also has a "self-deleveraging" system, deemed less "inflexible" than regulation via more clbadic socialized losses.
To encourage new retail investors to become involved in cryptographic derivatives, KuMEX offers a lower investment threshold than some other suppliers.
"The value of the XBTUSDM contract is $ 1, which allows traders to make a more flexible investment. At the same time, KuMEX offers the Makers a negative price of -0.025% with a fixed fee amount, encouraging users to provide liquidity to the platform by making the market and charging a commission as an incentive, "says KuCoin. .
KuCoin CEO Michael Gan said:
"Compared to the spot market, derivatives are much riskier because of the leverage used. We are therefore more cautious in providing such services. KuMEX is a derivative trading platform developed independently by our team. Since its creation, we have positioned it as an authentic and advanced financial product, so that all users can trust and negotiate freely without worrying about the losses caused by any form of manipulation. "
After the full launch of the platform, 50% of KuMEX's net income will be used for distribution to stock market token holders, KuCoin, the statement said.
Last November, the Singapore-based stock exchange raised $ 20 million in Series A financing from investors such as IDG Capital, Matrix Partners and Neo Global Capital.
KuCoin image via Shutterstock
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