AMA Recap: What Will Huobi Futures Bring to Turkish Users
On March 23, Huobi Futures went live for Turkish users under everyone’s expectations. Turkey is a vibrant country that has a high rate of crypto adoption, therefore the launch of derivatives trading for Turkey is undoubtedly a critical step for Huobi’s expansion in overseas markets. As we know, this will in turn broader the liquidity of the exchange, but what will it bring to Turkish users?
🎃 one-stop derivatives trading platform with coin-margined futures/ swaps, USDT-margined futures/swaps and options provided.
🎃 excellent liquidity and trading volume
🎃 mature risk control system and top-level technique to secure asset safety
🎃 no worry about the clawback
🎃 the positions of profitable users will never be reduced
🎃 7*24 point-to-point service
On Mar. 25, Tom Wong, COO of Huobi Futures was invited to the Turkish community to introduce the derivatives products of Huobi Futures and explain many questions that Turkish users are interested in.
Tom Wong, COO of Huobi Futures. Tom was a serial entrepreneur before joining the Huobi Group. After years of technical experience in Huawei, Tom started his journey in the blockchain industry first as a miner in Thunder and later starting businesses of his own. Currently, he takes a full range of operation and marketing as COO at Huobi Futures and becomes a crypto derivatives pioneer by introducing the VIP Sharing Program which was modeled later on across the industry.
Frequently Asked Questions
1. What are derivatives and which derivative products Huobi offer to their users?
A derivative is a contract between two parties that is based on an underlying asset (or set of assets). Derivatives are used by traders to speculate on the future price movements of an underlying asset, without having to purchase the actual asset itself, in the hope of booking a profit. Traders or businesses also use derivatives for hedging purposes, in order to mitigate risk against another position they have taken in the market.
Huobi now offers four products which are coin-margined futures, coin-margined swaps, USDT-margined swaps and options.
2. What are the differences between Coin-margined Futures, Coin-margined Swaps and USDT-margined Swaps?
As you can see there are two categories which are Coin- and USDT-margined contracts, and two contract types which are Futures and Swaps. I’ll explain the categories first:
COIN-margined Contracts are displayed as “COIN-Ⓜ” on the web. All of these contracts use their underlying assets as the margin for trading. Take BTC coin-margined swaps as an example, it uses its underlying asset BTC as the margin (collateral), meaning that if you want to trade BTC coin-margined swaps, you’ll have to deposit a certain amount of BTC into the account as the margin for trading first.
USDT-margined contracts are displayed as “USDT-Ⓜ” on the web. All of these contracts use the stablecoin USDT as the margin for trading, meaning that regardless you want to trade BTC, ETH, LINK, or UNI, you only need to deposit USDT into these accounts. In other words, you can trade different contracts with only USDT.
Then comes the difference between futures and swaps.
Futures have a delivery date while swaps not, you can hold swaps as long as you want if no liquidation occurs. On Huobi Futures, coin-margined futures have four expirations which are Weekly, Bi-weekly, Quarterly, Bi-quarterly. Users can choose different expirations based on their actual needs. As for trading fees, swaps trading has funding fees (charged between longs and shorts) while futures only charge transaction fees.
3. Why choose to trade Futures, Coin-margined Swaps and USDT-margined Swaps on Huobi?
🎃The highest trading volume and excellent liquidity. The annual trading volume of Huobi Futures in 2020 is nearly up to $2.3 trillion, with an average of 6.3 billion per day. Coin-margined Futures is the first product of Huobi Futures. Launched in December 2018, its trading volume has sustainably ranked first in the derivative market in only eight months. The second product coin-margined Swaps was launched on Mar. 27, 2020 and exceeded BitMEX, the largest coin-margined swaps exchange at that time, in 45 days. Its annual trading volume reached $785.5 billion in 2020 and it has covered 57 mainstream currencies, including a wealth of DeFi currencies for users to choose from. The latest product, USDT-margined swaps has grown rapidly with its cumulative trading amount exceeding $177.8 billion in just two months.
🎃 Robust risk-control system and zero clawback. Huobi Futures is the first digital asset derivatives exchange in the industry that supports a three-phase liquidation protection mechanism and no transaction fees will be charged in partial liquidation. The platform holds a record of zero clawback for 752 days since its launch in December of 2018. In version V6.3.0., the system has a throughput of 10W+, the response speed of placing and canceling orders is within 6ms, and the link delay is within 25ms.
🎃 Lots of innovative functions. To improve the asset utilization and to reduce and trading cost, Huobi introduced lots of innovative features like locked margin mechanism, take-profit and stop-loss, real-time settlement, Follow a Maker & Taker, etc. Huobi Futures also designed “Switchable Leverage When Holding Positions” function for its coin-margined positions. With no need to close positions first, users can switch leverage with positions holding as long as there is no open order. All these exciting functions empower both institutional and retail traders to fetch out maximum benefits in derivatives trading.
🎃 Other factors such as the positions of profitable users will never be reduced; 7*24 point-to-point service.
4. Could you please give us more details about the leverage and the order types of Huobi Futures’ products?
You can see the below chart for details of the leverage and order types. All of the coin-margined futures/swaps and USDT-margined swaps supports leverage up to 125x, meaning users can begin trading with a very small principle.
When talking about the order types, Huobi supports multiple order types including Limit Order, Trigger Order, IOC and FOK, Flash Close, Follow a Maker & Taker available.
5. What are the benefits of futures trading and how to earn profits with lower risks?
Unsurprisingly, digital asset derivatives exert a significant impact on the digital asset market because they provide numerous advantages to the market:
🎃Hedging risk exposure
🎃 Underlying asset price determination
🎃 Market efficiency
🎃 Access to unavailable assets or markets
Here are some methods for you to earn profits with lower risks:
Lock profits via hedging
With futures trading, you can develop trading strategies where a loss in one investment is offset by a gain in a derivative. Simply put, if the asset you are hedging against makes money, you have also usually reduced your potential profit. However, if the asset loses money, and your hedge was successful, you will have reduced your loss or earn profits. In this way you lock the profits through hedging.
Trade futures in different expirations to arbitrage
For the same asset, if there are futures in different expirations that have a relatively huge spread, we can buy lower-price futures and sell higher-price futures, and close the positions when the spread is shortening to gain profits. Please kindly note that the buying and selling amount should be equal.
Trade swaps to earn funding fees
As we know swaps have no delivery date and use “Funding Mechanism” to anchor the spot price. The funding is not charged by the platform, but between longs and shorts.
When the funding rate is positive, the longs will pay funding to the shorts and if the rate is negative, the longs will receive funding fees from the shorts. Then we can earn funding fees via some operations.
Trade as an option buyer to earn unlimited profits.
An options contract offers the buyer the opportunity to buy or sell — depending on the type of contract they hold — the underlying asset. Unlike futures, the holder is not required to buy or sell the asset if they choose not to. For options buyer, the risk is limited while the profits are unlimited. The most important, there is no liquidation. Hence we can trade as an option buyer to earn unlimited profits with a low principal.
6. Do you offer any VIP services for futureers or pioneer program to eligible partners?
Due to the fact that most exchanges require at least hundreds of BTC to be traded per month to reach their VIP standard, many traders have been rejected by these platforms to get a VIP when the annual increase in Bitcoin price has risen by 400%. On Huobi Futures, all evaluation on the trading amount is based on USD or USDT with a stable value all the time. In addition to that, Huobi introduced an upgraded VIP Sharing Program, that is, VIPs of any other exchanges are considered as Huobi Futures VIP+1. Users could provide certificates of VIP level on other platforms to apply for a VIP+1 level on Huobi Futures. Please check the below chart for details:
After becoming a VIP of Huobi Futures, you’ll be able to enjoy:
· Preferential fee rate
· Higher API rate limit
· Larger position limit
· Derivatives sub-accounts available without application
To apply for a VIP, please click: https://support.hbfile.net/hc/en-us/articles/900000878746-Huobi-Futures-VIP-Market-Maker-Clients-Only
And for pioneer program, our 2nd-term Pioneer Recruitment is in progress. KOLs from mainstream social platforms such as Telegram, YouTube, Facebook and Twitter are qualified to join Huobi Futures Pioneer. Anyone who manages a social media platform or enthusiastic about futures trading can also join us. After becoming a pioneer of Huobi Futures, you will get:
· Tiered basic rewards: minimum 200USDT per month, pioneers with excellent performance can acquire a basic reward up to 500USDT/per month;
· Special rebate: available to enjoy a 60% transaction fee rebate permanently on Huobi Futures;
· Quarterly bonus: pioneers with level above L2 can join to share $10,000 quarterly bonus.
For more details, please check: Huobi Futures Pioneer Recruitment Officially Starts (2nd Term) — Help Center (hbfile.net)
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