With the rapid development of virtual currency futures . The majority of users hold more and more assets , The trading methods of virtual currency have also become diversified . this paper MYY1003G Organize and release
Contract trading system is a derivative of digital assets . Users can judge up and down , Choose to buy long contracts or sell short contracts to get a rise in the price of digital assets / Declining earnings . The contract trading system uses the mode of differential delivery , At the expiration of the contract , All open positions , Close the position according to the arithmetic average of the last period of the index price , Not physical delivery .
Contract trading system is a derivative of digital assets . Users can judge up and down , Choose to buy long contracts or sell short contracts to get a rise in the price of digital assets / Declining earnings . The emergence of contract trading has ended the history that bitcoin could not be short before , It opened the prelude to the development and prosperity of bitcoin derivatives market .
What is the role of a contract exchange ？
1、 Hedging and the role of hedging risk ：
At present, the contract mainly plays two roles for users , That is to say, to hedge risk with small and broad . It's easy to understand , That is, through leverage to amplify earnings , And most people who hedge against risk are mainly miners . Besides , For contracts , When prices rise or fall unilaterally , There will be an opposite force pushing prices back to a relatively ideal state , Controlling spot market prices , Make short-term irrational prices return to rationality .
2、 Increasing asset liquidity is conducive to more institutional investors entering ：
Because many institutional investors can't invest directly in bitcoin , Derivatives from major exchanges give these investors access to the bitcoin market .
3、 Expand trading methods , Competing for bitcoin pricing power ：
Diversified trading strategy of virtual assets in contract trading , It can be short or more . meanwhile , The spot market and the contract market will guide each other , Increase the size of the entire virtual currency market .
We deeply understand the impact of blockchain technology on the whole industry , I have also witnessed the transformation of Internet technology for the industry . The Internet era belongs to 80 Post Era , I believe that the era of blockchain will belong to 90 Later and later .