FTX is one of the newer crypto exchanges that’s been making waves recently. For derivatives, the exchange ranks 5th on CoinMarketCap, with a 24hr volume at $41bn. For spot, FTX ranks 267th with a 24h volume at $6.9bn across 479 markets.
The fast-growing crypto exchange created by 29-year-old billionaire Sam Bankman-Fried specializes in crypto derivatives offering futures, leveraged tokens, tokenized stocks covering mostly growth stocks, and options contracts.
Other products that are less commonly offered on other exchanges include MOVE contracts enabling trading based on small price movements of a specific cryptocurrency and prediction markets covering outcomes of real-world events like elections or tournaments like the Olympics.
Founder Bankman-Fried is known for his innovative approach towards financial markets, and in his view, there is a lot of room for improvements in the traditional space, taking lessons from how crypto exchanges operate. That is why FTX pushes the boundaries on products stuck as tokenized Tesla stocks, legal within the regulatory framework of Hong Kong which is where the exchange is based, but not be permitted under U.S. law.
Exchange token FTT
FTT is the native exchange token of FTX and operates as the backbone to the entire ecosystem. At its core, FTT token is designed as in incentive token much in the same way as AAB for AAX, BNB for Binance, and HT for Huobi. Simply holding FTT will enable you to lower your trading fees, which can be of particular interest to active day traders.
Staking FTT also proved a number of benefits including increased referral rates, maker fee rebates in addition to FTT fee discounts, bonus votes in polls, increased SRM airdrop rewards, waived fees for ERC20 withdrawals and early access to IEOs hosted on FTX.
To increase the scarcity and value of FTT token, FTX conducts a buyback and burn program every week. Other exchanges run similar programs but do so on a quarterly basis. FTX does it on a weekly basis which means FTT burning is constant. FTX buys FTT on the FTT/USD market to burn tokens equal to 33% of fees generated on FTX markets, 10% of net additions to the insurance fund, and 5% of fees earned from other uses of the FTX platform.
Exchange tokens are soaring across the board
Native exchange tokens have exploded in value in recent months, alongside the wider cryptocurrency market. Due to major institutional investors finally entering the markets in a big way, BTC, ETH and a long list of coins have exploded in value reaching new all-time highs. With that increased interest in crypto comes more trading activity, leading native exchange tokens to reach new all-time highs as well.
Crypto exchange tokens have been around for a few years now, and they have proven especially useful for platforms to add value for their customers. While every exchange will use native tokens in different ways, there are typically 3 core use cases for an exchange to implement its own token: kickstarting liquidity, offering discounts on trading fees, powering operations the same way ETH is used as gas on the Ethereum blockchain.
Simply put, as trading activity increases on an exchange, so too does the demand for its native exchange token as more traders look for ways to reduce costs and reap additional benefits through staking and other products. This puts upwards price pressure on the exchange token, which then in turn creates additional interest from speculators not necessarily active on the platform itself, but looking to make a profit on the coin’s price movements.
Arguably the best known and most liquid of all exchange tokens is BNB, the native token for the Binance exchange. The BNB token has bootstrapped the exchange’s position in the retail crypto trading space as it ventured into new markets. Other native exchange tokens that have made gains in tandem with trading activity include AAB, HT, KCS, BIX and BTMX.
Trade Exchange Tokens on AAX
AAX offers a highly secure, top-tier exchange venue, powered by London Stock Exchange Group’s LSEG Technology. Among a wide range of crypto assets, DeFi tokens and base protocol cryptocurrencies, AAX also lists a range of exchange tokens such as BNB, FTT, KCS, HT and AAX’s native exchange token AAB.