The exchange rolled out the Bitcoin Perpetual Futures Contract Thursday, and stated that the latest offering is “well suited to the current trading environment.”
The perpetual contract is intended to serve professional traders carrying diverse risk profiles, with liquidity and quotes offered by third-party market makers.
The cryptocurrency exchange has asserted that its latest Bitcoin contract is backed by reserves that were funded via fees and other trading revenues.
Contrary to conventional futures products, a perpetual futures agreement does not have fixed settlement or expiry date, which implies the user can carry on with the position without any time limits, provided they hold adequate margin amount in their account. Another large cryptocurrency exchange platform offering perpetual contracts based on Bitcoin is BitMEX.
Richard Byworth, CEO of Diginex, opined that the latest futures contract is aimed at offering better functionality to the crypto market, an initiative he believes will “facilitate wider institutional and professional trader adoption of cryptoassets.”
“This is just the first in a product suite that will offer investors more dynamic hedging tools, fairer liquidation, a platform that is not trading against its users and reputational protection for investors seeking a KYC/AML compliant ecosystem.”
In the last few quarters, Bitcoin futures market has been recording exponential growth, underlining the rising interest from major institutional investors towards cryptocurrencies. Equos has stated that cryptocurrency derivatives market has grown more than four times the rate at which spot market grew in 3Q20, attaining daily volumes (peak) of $67 billion by November end.