Delta Exchange CEO predicts that crypto derivatives will grow significantly in the coming years, but 2021 is the year of options
We recently connected with Pankaj Balani, Co-Founder and CEO at Delta Exchange, an established trading platform for digital asset derivatives.
Delta Exchange offers cryptocurrency futures and derivatives that are traded via Bitcoin and major altcoins with up to 100x leverage. As previously reported, the company aims to support the continued growth of the cryptocurrency financial system by developing a “highly liquid and trusted” derivatives exchange that serves retail and institutional traders.
Delta Exchange, which is not regulated in any jurisdiction, has a powerful matching engine, easy-to-use interface, advanced order types, and fast APIs. The exchange provides access to a trading platform for institutional companies designed for the emerging markets for crypto assets.
Last year, Pankaj explained why the company’s MOVE contracts will benefit the crypto industry. Pankaj had also discussed how the Bitcoin Cash (BCH) network had impacted after the halving in 2020.
In previous conversations with Crowdfund Insider, Pankaj had also detailed how we can assess the economic value and fair price of Compound’s COMP token, which rose dramatically during the DeFi boom last summer.
Our recent conversation with Pankaj focused on why traders should consider trading on Delta Exchange instead of larger platforms like Binance. We also touched on other important developments in the blockchain industry.
Our discussions are shared below.
Crowdfund Insider: Elon Musk’s Tesla has invested $ 1.5 billion in Bitcoin (BTC) and accepts the digital currency as a means of payment. What effects does this development see on the area of crypto assets?
Pankaj Balani: Tesla’s endorsement of Bitcoin will give crypto a lot of legitimacy in the eyes of those who don’t actively follow the space.
This will put Bitcoin on the radar of many other treasury managers around the world as well and this can draw large currents towards the market. We will definitely see an increase in attendance as a result of this event.
Crowdfund Insider: Trading digital currency derivatives has become very popular, and there are many platforms like Binance that offer their customers different ways to get involved in this market.
What makes your platform unique and what are the advantages of trading digital assets on Delta Exchange?
Pankaj Balani: Our range of derivatives is much more extensive compared to other platforms. For example, we offer perpetual swaps for a number of Alt BTC pairs. These are not available on other platforms. Alt BTC pairs usually have much lower funding costs and are therefore cheaper to trade. We also offer options for altcoins. We are the only exchange that offers options on BCH, LTC, BNB, LINK, XRP, etc. in addition to BTC and ETH options.
All options on Delta Exchange are settled in USDT, unlike other platforms where you need BTC to trade BTC options and ETH to trade ETH options. We have developed products that are simple and inexpensive for retailers. That is why users prefer to trade on Delta Exchange.
Crowdfund Insider: What do you expect from the growth of the digital asset derivatives market in the coming years?
Pankaj Balani: Derivatives will multiply over the next few years, but 2021 will be the year of options. We’ve already seen strong growth in the crypto options space over the past 6 to 9 months, and we expect this trend to continue. Even in stocks, the options segment has seen strong growth in recent years, with retailers dominating the volume. We expect the same for the crypto markets this year too.
Crowdfund Insider: What are the main benefits of trading crypto derivatives instead of trading regular digital assets (assuming you have the skills to do so)?
Pankaj Balani: Derivatives enable traders to hedge their portfolios and protect themselves from price and volatility risks. Most professional money managers use some type of derivative to protect their portfolio from these risks.
These instruments can also be used to trade the momentum in a capital efficient manner as they provide leverage. Due to the associated leverage, however, one should be very careful when using derivatives. Leverage is a double-edged sword and one should make sure they understand how to trade these instruments before embarking on them.
Crowdfund Insider: What Simple Trading Strategies Would You Recommend To New Traders?
Pankaj Balani: Developing and maintaining trading strategies is difficult for most traders. It requires good programming skills, infrastructure, clean, good quality data for backtesting, and continuous monitoring. However, in markets as volatile as crypto, program trading has clear advantages over manual trading.
We saw a lot of interest from our traders to trade with bots and that’s why we introduced RoboTrading. RoboTrading is a strategy market where traders can see the strategies available, their past performance on a daily, weekly, monthly and yearly basis as well as the loss of a strategy among the historically best ratings, risk ratings and other details. Trades can simply subscribe to any strategy they like and take advantage of automated trading without getting into the complexities of coding those strategies.