Huobi Launches Derivatives Market
The Singapore headquartered cryptocurrency exchange Huobi has launched its own derivatives market called Huobi Derivative Market (Huobi DM).
Cryptocurrency Contract Trading
Huobi unveiled the Huobi DM platform during the Cryptofrontiers event in New York. The exchange, during the launch, highlighted the fact that this new platform allowed customers to conduct cryptocurrency derivatives contract trading on both rising as well as falling crypto prices. Huobi also said that this new platform provides users with tools that can be used for hedging and for controlling uncertainty and risk.
Contract trading is a form of trading where and investor can buy and sell assets, in this case digital currencies, at pre-set prices at particular times in the future. This gives investors as well as traders the chance to open both short and long positions.
Houbi stated that once the derivative contract had been executed, parties would be able to buy and sell their cryptos at the agree-upon price, no matter what the market prices were. The exchange also stated that when investors were buying or selling these futures contracts, they would have the option of choosing 5X, 10X and 20X leverage.
Huobi stated that the platform was currently in its beta testing phase and so was not available for customers in certain regions. These regions are Cuba, Iran, Israel, North Korea, Singapore, Syria and the US.
The company stated that they were not rushing this project and were talking with their lawyers and the relevant regulatory bodies to understand the legal and other requirements in each country. Houbi also stated that it was going to take all the necessary steps to ensure that this new platform was offered in a compliant manner.
Ensuring Compliance and Safety
Houbi is one of the crypto exchanges that has focused on customer safety by limiting both risk as well as uncertainty by using a 24-hour monitoring process for its exchange.
The company also offers an insurance fund of up to 20,000 BTC to customers who have been victims of a security failure. The exchange also offers an insurance fund for trading pairs against losses due to unfilled liquidation orders. Houbi also has a circular break mechanism in place which protects its users from liquidations that are either unnecessary or forced.
The general counsel of the exchange’s global institutional team, Joshua Goodbody stated that Huobi has been known for its innovation in the cryptocurrency space. He said that their company looked to the future and would always bring their clients with them on their journey.