Binance Futures Review, Month 3: Reasons Why Traders Choose Binance Futures
On its third month of operations, Binance Futures launched its ETHUSDT futures pair, a futures calculator, and more. Binance Futures Director Aaron Gong shares some user feedback on why they prefer Binance Futures.
Dear Binance Futures Community,
I hope you’ve been enjoying this recent period of volatility! Crypto prices across the board have been erratic, and this has led to increased volume across all major exchanges, especially derivative exchanges. Binance Futures is strongly positioned as a price-discovery leader and a major source of risk hedging for BTC #HODLers. This is reflected in our exponential growth numbers: we saw 4,042,674 BTC traded in November, a 65.71% month-on-month increase. We also reached our most recent ATH on November 22nd, with 371,214 BTC traded.
It still surprises me that it’s only our third month in existence, but already so much has changed from when we entered the derivatives space, from technology and product design to business strategies. Our innovations and strong customer loyalty have been rewarded with incredible growth, which will continue throughout the remainder of this year and into 2020.
To give a more comprehensive picture of how we captured market share in such a short period of time, we have some results from client focus groups to see why they prefer Binance Futures to other alternatives.
1. Leading role in BTC price discovery
Many of our institutional clients have noticed starting from mid-November, BTC price is moving first on Binance Futures. Price discovery is the gold standard for markets - the market that moves first tends to capture more and more volume as traders migrate to avoid being front-run by the high-frequency API programs.
We are proud of our innovative fee structure, industry-leading technology, and deep liquidity. These factors are steadily showing in our market leadership.
2. Real, tradeable volume for both takers and makers
When we introduced our low-taker fee model (without needing to ser negative maker fees), there were a lot of questions raised both internally and externally, as this was unique in the derivatives space. Too many exchanges were copying the first one, without showcasing their own strengths.
In fact, we’ve shown that our structure has exceeded expectations by creating a much healthier trading ecosystem. Because of our industry-lowest taker fees, we attracted relatively heavier taker volume which helped makers fill their desired orders. Too many other exchanges offer negative maker fees, where most orders are just computerized market makers competing for best bid and ask with extremely limited taker interest during periods of non-volatility.
Many API clients have informed us their theoretical backtest results much more closely resemble real-life results due to the high fill rate and low slippage rate for trade executions.
3. High leverage trading is most popular amongst retail traders
On average, over 60% of traders on Binance Futures trade at a leverage of 20x or higher. Users trading at 125x leverage account for 21% of total traders, on both desktop and mobile. While high leverage trading is most popular among Binance Futures retail traders, most of its institutional traders--who contribute to 81% of the total trading volume--tend to trade at a leverage of 20x or less.
We are continuing to grow our market but will remain committed to ensuring a healthy ecosystem to optimize both retail and institutional user experience.
In the last 30 days, here are the things we accomplished in our #BUIDL list:
* New ETHUSDT futures trading pair – We launched this two weeks ago, with up to 50x leverage. ETHUSDT has grown in volume and liquidity much faster than BTC did, as shown in 1- to 2-cent spreads for the trading pair just a couple of weeks after launch.
* Futures Calculator – Know your PnL, target, and liquidation prices before placing your orders.
* Futures on Binance IOS app – Binance Futures is finally available for iPhone users. We expect this to be a major growth driver for our derivatives market.
* 3rd welcome bonus – This promotion lasted only 5 hours, due to overwhelming user
* Content creation competition – Lots of cool videos from the community
* ETH positions sharing prize – Just a little bonus for our dedicated followers!
* Trading Fee Discount Program – We have recently introduced a 10% discount promo for BNB #HODLers, as a further reward for user loyalty.
Many more features are on the way, including (but not limited to) Isolated Margin, Cross Collateral, more trading pairs, etc. More holiday treats will be announced shortly. Stay tuned and Happy Holidays!
- AG, Binance Futures Director