FTX is a recently formed centralized cryptocurrency exchange that specializes in crypto derivatives and leveraged trading products. Billing themselves as the exchange created by traders, for traders, FTX has rapidly gained prominence and grown to rival the likes of Coinbase, Binance, Kraken and other large, well-known crypto exchanges. With support for hundreds of spot tokens, leveraged tokens, and futures contracts there’s plenty here to satisfy even the most experienced crypto trader. But it doesn’t stop there.
FTX also has a number of innovative features that recommend it as the exchange for any crypto trader.
The following review of FTX will take you through a tour of the products on offer, the supported tokens, the fees you can expect to pay on your trades, and the functionality of the trading platform. Ready to get started? So are we.
What is FTX Exchange?
FTX is a fairly new crypto exchange, having been launched in May 2019 by co-founders Sam Bankman-Fried and Gary Wang. The exchange garnered early support with an endorsement from the quant crypto trading firm Alameda Research, which is not surprising, since Bankman-Fried also founded Alameda back in October 2017, though he has since handed the CEO reins along.
With its focus on futures and leveraged trading FTX quickly filled a niche in the crypto trading ecosystem.
Interestingly, one of the early backers of FTX was competing exchange Binance. All the way back in December 2019 they became a strategic backer of FTX. However as of July 2021 the two exchanges have parted ways, likely because of their competing platforms.
Thanks to the fact that the FTX platform was designed by traders, for traders, it is an easy to use and intuitive platform that’s a pleasure for experienced traders and easy to pick up for new traders. FTX Exchange Review Pros and Cons
FTX is an excellent exchange for beginners who are looking for an easy to understand platform, but it’s also excellent for seasoned traders thanks to its low fee structure, leveraged trading options, and advanced trading features.
U.S. clients have a limited platform
Some major coins aren’t listed
The FTX Debit card (FTX US only) Pro Exchange
Here’s a closer look at some of those Pros:
Low Trading Fees: One of the primary draws of the FTX exchange is the low trading fees. Maker fees start at 0.02%, while taker fees start at 0.07%. For those unfamiliar with the maker/taker terminology, maker fees are charged on orders that aren’t filled immediately, that is the limit orders that go onto the exchanges order books. Makers get lower fees as a way to incentivize them to provide liquidity. Taker fees get charged to the market orders that are filled immediately. High volume traders and those staking the native FTT token of the exchange get even lower fees.
Large Cryptocurrency Selection: In total FTX has roughly 300 cryptocurrencies available to trade, either on spot or as futures. This is a great selection and FTX continues adding new coins all the time.
Earn on your Holdings: It’s possible to stake several coins at FTX and as of the date of writing this piece one of them pays 20% APY. That’s a pretty decent rate of return, especially since banks are currently paying interest rates of 0.1% or less.
FTX – The Good and the Bad. Image via Medium
Advanced Orders: Besides the basic market and limit orders FTX also has a number of advanced order types to help manage your portfolio and risk. These include Trailing Stops, Take profit market and limit orders, and stop loss market and limit orders. These advanced order types allow you to enter a position and then set all your selling conditions and forget all about the position until it’s closed. It’s very handy not to have to constantly monitor all your open positions.
Margin Trades: Not everyone can access margin trading at FTX, but if your account is over $100k margin trading is enabled. This means you can trade with up to 10x leverage, giving you a more efficient use of your capital. Remember that margin trading is high-risk and isn’t recommended for beginners or even most experienced traders.
The NFT Marketplace: FTX has recently opened a marketplace for buying and selling non-fungible tokens (NFTs). It’s also possible to use the marketplace to mint your own NFTs and then auction them off to other users. As of November 12, 2021 FTX has disabled minting on its international portal, however it’s still possible to mint NFTs at FTX.us, which is available to users inside and outside the U.S.FTX Exchange User Experience
The second you land on the FTX homepage you’ll immediately see the amount of effort that the team behind the exchange has put into creating a positive user experience, not only for experienced traders, but for all experience levels. There are a number of customization options such as the sleep interface that will toggle the exchange website between light, dark, and black modes.
Nearly all the information you need about the exchange is accessible from the homepage, even if you aren’t yet a registered client. We loved this level of transparency in a world where so many exchanges try to hide features that prospective clients might not like. But then there’s very little about FTX that you won’t like.
Perhaps one of the greatest customizations is the ability to move elements of the trading platform around to best suit your own style. Note that you do not need to create an account and be logged in for this feature to be active. Simply go to Settings and choose “Unlock Layout”.
Have a specific layout in mind. Unlock and get creative! Image via FTX.com
If you have any questions on how to use various features of the exchange there’s a detailed help section where you’ll find user guides and tutorials explaining every aspect of the exchange platform. And those who trade on the go can download the FTX mobile app (for Android and iOS) and have access to all the same great tools and features everywhere they go.
FTX also supports automated trading through its Quant Zone and the use of API keys to automate trading easily. FTX Exchange Trading Products
Because FTX is primarily a derivatives exchange it means in most cases you aren’t trading the actual asset. That means you can’t buy many of the coins and send them off the exchange to your own wallet. The derivatives offered are simply a reflection of the underlying asset, and so you’re trading on the price.
That said, because FTX is based around derivatives like futures and leveraged tokens they can offer some very unique tradeable products you won’t find elsewhere. Below we take a deeper look into the products being offered by FTX and their features. FTX Exchange Trading Futures
A future is a financial derivative in which two parties agree to trade a specific asset at a future date and at a predetermined price. This allows for some interesting arbitrage opportunities at times, and it also means that traders can benefit from the use of leverage when trading futures contracts. On FTX most of the futures contracts allow for leverage of up to 10x to be applied when trading. That means your gains and losses are magnified 10x. It’s very powerful, but also very dangerous if not used properly.
One of the other benefits to the futures offered at FTX is that many aren’t offered as futures anywhere else. This is particularly true for the lesser known altcoins that have smaller market caps and lower liquidity.
As of October 2021 FTX is offering more than 200 different futures contracts on over 100 different cryptocurrencies. These futures are near dated (2 months), further dated (5 months) and perpetual. In addition to individual cryptocurrencies there are also a number of indices that can be traded as futures. Very powerful stuff.
Note on Perpetual Futures: These are futures contracts that do not expire. Instead, the price of perpetual futures is updated every hour to keep pace with the value of the underlying asset. FTX Exchange Options
Options are another derivative product available on FTX. These are similar to futures, but don’t require the holder to actually purchase the underlying asset when the option expires. Rather options give you the right to buy or sell an asset at a specific price. You are not obligated however and can freely allow the option to expire without exercising it.
