OKEx Introduces Crypto-Based Futures Contracts Settled in USDT

Digital currency exchange OKEx is to release a range of digital currency-based futures contracts settled in the stablecoin tether (USDT). 

The exchange will provide support for USDT pairs including bitcoin (BTC), bitcoin cash (BCH), ether (ETH), bitcoin SV (BSV), EOS, XRP, and Tron (TRX) with leverage between 1 and 100x when trading initiates on November 6, as per a public statement released on October 29.

The company asserts its linear futures contracts will be more straightforward for amateur traders to deal with, as holders don’t need to hedge the margin risk as they would do with inverse contracts.

“Most of the time, users are not willing to hold altcoins as margin, and they also see inverse contracts itself are complicated to understand. We see this linear contract would be an open door to many new retail traders,” said Lennix Lai, financial market director of OKEx.

A stablecoin connected (or expected to be) to the U.S. dollar, tether hasn’t yet been broadly utilized as the basis for futures contracts, though CoinFLEX introduced a comparative product in January.

OKEx stated it will keep including more stablecoin-based trading items soon. “We would continue to research and add stablecoin-based derivatives so to offer a simpler hedging instrument for traders who normally book their profit and loss in USD value,” Lai further stated.

To guarantee price fairness over the market, OKEx’s tether futures contracts will be an average of digital currency exchanges Huobi, Coinbase, Bittrex, and Binance’s tether spot costs. Contract settlement will happen every day at 8:00 UTC.