The market for cryptos has grown rapidly over the last few years. BQT is an exchange that offers very interesting options for crypto traders. Crypto to crypto hedge trading is a way for a crypto holder to gain access to another crypto, without dealing with fiat currency or a direct trade of cryptos.
In addition to hedge trading, BQT also offers its users a fully featured social trading environment that facilitates open communication and peer-to-peer crypto trading.
The world of fiat currency may be under pressure, and direct crypto to crypto trading approach could become more popular as central banks attempt to prop up the global economy. One of the biggest things that keeps the established financial system going is the perception of stability, and that appears to be changing.
BQT is Entering the Market at the Right Time
The crypto exchange boom is in full swing. There are thousands of crypto exchanges, but the vast majority (70%+) follow the same model. Most crypto exchanges hold client funds and act as a trading intermediary.
In many ways, the most popular crypto exchange model makes the exchange both broker and exchange, which means a ton of counterparty risk for their clients. If an exchange were to go under, or even offline, traders would not have access to their funds.
The simple solution to this problem is peer-to-peer (P2P) exchanges. Instead of the exchange acting as a custodian, it simply fulfills the role of intermediary and establishes a safe environment for trading.
Clients never lose control over their funds, which may be one of the biggest reasons why P2P trading platforms (like LocalBitcoins) are doing a trading volume that has reached as high as $75 million USD on a weekly basis.
Social Trading and Making Connections
It is easy to forget that when markets started, there was a lot of person-to-person interaction.
Today, when we look at a bid/ask spread, we sometimes forget that there is a person or trading desk behind both those numbers. Social trading platforms allow traders to bring the human element back into the trading experience and learn from each other.
The community trading experience is a big part of BQT’s platform. In addition to allowing traders to connect and talk about the markets, the BQT wallet allows users to trade with each other directly.
BQT P2P Hedge Platform
Short term hedge trades also lets traders connect, and craft deals on a bespoke basis. BQT’s P2P hedge platform is currently under development and will allow traders to create custom agreements once it is online.
The BQT hedge platform offers some incredible capabilities.
Let’s say that you want to get your hands on some ETH, and you are holding BTC. Normally, you would have to sell your BTC, and buy ETH.
BQT’s hedge platform will give you a ton of other options.
Instead of selling your BTC, you could offer it in a swap, for a given amount of time, at a fixed rate of return for the counterparty.
Let’s say you offer 2 BTC for 80 ETH for a month, as well as a 2% premium that will be paid in BTC when the hedge trade expires.
The platform that BTQ is working on will allow traders to create just about any hedge trade they want, with BTQ acting as an escrow agent to make sure there is ZERO counterparty risk.
If you want to learn more about this innovative new trading tool, check out BTQ’s whitepaper for lots more info.
The Fiat Currency System is Under Pressure
You might have noticed the big jump in Bitcoin prices over the last month or two. Global central banks are on the edge of another easing cycle, which could spell trouble for fiat currency.
Crypto exchanges that focus on crypto-to-crypto trading may be in a good position as the value of fiat currency begins to be questioned by more people around the world. In addition to offering ease of trading, crypto-to-crypto exchanges make it easier to trade in the real world.
Here is how it works.
Pretend you are a merchant in Venezuela, and your business accepts Dash in exchange for the goods you sell. Some of your suppliers are willing to accept ETH from you, which means you need to convert DASH to ETH at the lowest rates possible.
A merchant in this situation has also worked around fiat currency altogether, as they are able to do business entirely in cryptos (at least for some products).
BTQ Takes it a Step Further
BTQ’s hedge platform would give anyone who needs to do business in multiple cryptos even more options.
The vendor in the above example doesn’t even have to sell their DASH with BTQ’s hedge platform. Instead, they could offer to swap a given amount of DASH for ETH, and pay a small fee to the counterparty for the use of the ETH.
The vendor could then take the ETH they receive via the hedge trade and use it for whatever they like. After a week or a month (whatever was agreed to when the hedge trade began) the vendor would have to return the ETH to the counterparty. The DASH would revert to the vendor, who never technically sold it to gain access to ETH.
The use of hedge trades isn’t going to be right for every situation, but it is an amazing tool for traders and crypto users to have. Traders in nations that charge capital gains taxes on cryptos may be especially interested in hedge trades, as they may fall into a different category for taxation.
P2P Trading Makes a Lot of Sense
Cryptos give people to ability to have direct ownership of their assets, which is a major shift away from the established financial system. Unfortunately, the most liquid crypto exchanges tend to act as custodians for their client’s funds, which makes trading cryptos a lot riskier.
When a person allows another entity to act as a custodian, they are taking on all the risk of that counterparty. The cryptos are no longer theirs, and they are in essence an unsecured creditor of a crypto exchange.
An unsecured creditor has no direct claim to their assets in the case of a bankruptcy. Anyone who was unlucky enough to be caught up in the Mt. Gox fiasco understands how few rights unsecured creditors have.
P2P exchanges remove the middleman and eliminate counterparty risk as well. BQT’s vision for a P2P trading community is in-line with the ideals that started the crypto revolution.
The BTQ Token
Like many exchanges, BTQ created a proprietary token for use on its exchange. The BTQX token has to be used to pay the1% transaction fee for instant trades and the 3% escrow fee for Hedge Trades on the platform.
For traders that want to build community connections, and maintain ownership over their crypto assets, BTQ exchange is worth learning more about. The platform offers interesting features that let traders learn from the community, and establish themselves as more than a bid or ask.
The world of cryptos is still young. A little more than a decade ago the first crypto was born, and now the world’s largest companies are entering the space. BTQ has entered an exploding market at a great time and is worth learning more about.