Safety and insurance of assets in DeXe
We all realize that the cryptocurrency market is extremely volatile. In contrast to the traditional stock market, there is practically no insurance proposed to users, and methods of hedging risks are very unstable. Every person who has traded ever understands that the opportunity to increase their funds is equal to the chance of losing it.
Dexe team considered all the possible risks that users may face and offer a number of solutions united in the DeXe platform.
The first significant thing is the models of traders choosing. There is an opinion that a trader who doesn’t have his own capital cannot discard others’ assets.
That is the reason there is a system of coefficients on the platform, according to which the measure of assets in traders’ management relies upon the amount of the total trader’s balance.
For instance, in the event that a trader has a deposit of 1000 dollars on the platform, then he can deal with 500 dollars. That is, for 1000 dollars, goes a 0,5 coefficient. that means that coefficient is calculating in the next way: at $1000 x 0.5 = $500, at $2000 x 1 = $2000, at $3000 x 1.5 = $4500, etc.
The greater the amount of a trader’s personal funds, the more funds are in his management.
Moreover, the platform provides statistics of each trader, and before beginning copying, the user can analyze the trading deals, see the trader’s rating and choose a trustworthy one. However, this isn’t the most interesting and important thing either.
The key feature of DeXe is insurance compensation for unbeneficial trading.
DeXe Assets Insurance
Currently, most centralized cryptocurrency exchanges provide insurance in the event of a hacker attack, critical bugs, and so forth. There are even some companies that offer their types of services in the field of insurance of digital assets, however, nobody will protect users in case of a losing trade balance. No one except for DeXe.
DeXe gives every user a special opportunity to guarantee their assets and, in case of losing a trade balance, receive compensation in the measure of their initial trade deposit.
The client has to stake DeXe tokens in the measure of 1–10% of the total of his funds.
Depending on the number of DeXe tokens staked, and the size of the insurance pool the user will be compensated in full or to some degree.
How is the insurance pool formed?
As you definitely know, in the case of copy trading, a trader sets a certain % of the commission that is charged from his subscribers (from 20 to 70%), and from these commissions, the DeXe smart contract subtracts 30%.
For this sum, it automatically redeems DeXe tokens on DEX and partitions it into 3 equivalent parts:
1.10% burned
2.10% goes to the insurance pool
3.10%, which is 100% of the platform’s profit, is distributed among the holders (rewards for farming, and so on.)
However, it is important to remember that not every loss-making trade will be compensated by the insurance pool. Since the platform works on the principles of a DAO, decisions on insurance events will be made by voting of DeXe token holders with the participation of the governance. Thus, each user of the platform turns into a significant component of a secure ecosystem creating, and the DeXe token gains even more value.
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