Why Millionero's Crypto-Backed Derivatives are a Game Changer in the World of Trading?

2023-02-23 06:40:17 · 693 views · 5 min read

Millionero Perpetuals Market


2022 was by no means kind to crypto, but while many newcomers hastily pulled out their investments and fled from the markets, long-time investors held steady with their faith in the recovery of crypto. Now, while the spot markets witnessed a duality in the opinions of investors, the crypto derivatives market gained a new following, where people can profit regardless of the direction the market might move into next.


Crypto derivatives are still a relatively new phenomenon, and as a newcomer, it’s natural that you would be uncertain about your first move. However, they are a valuable tool when you think of risk management in the crypto market, and of course, you can pull in sizable profits if you trade right.


As a beginner in the crypto derivatives space, a user-friendly crypto exchange like Millionero can be just the help you are looking for. Millionero’s crypto-backed derivatives can prove to be a game changer in the world of crypto trading. Read ahead to learn how!



What Are Crypto-Backed Derivatives?



Let’s start with the basics:

A crypto derivative is a financial agreement or contract that takes its value from an underlying cryptocurrency. It is, however, traded using cash amounts, with the profits or losses also being settled in cash. The most common digital asset that crypto derivatives are based on is Bitcoin. However, altcoins like Ethereum and Litecoin are also used to back crypto derivatives.


A “crypto-backed” derivative, on the other hand, is an instrument where the margin/collateral is also a cryptocurrency. So your profit and loss settlements happen in the cryptocurrency you decided to put up as collateral for the trade.


Crypto derivatives can be used for a variety of purposes, including: 

- Hedging 

- Speculation 

- Arbitrage


Crypto perpetuals are an easy-to-use derivative that take this concept one notch further- while you get the right to buy or sell a certain amount of crypto at a set price when you purchase a perpetual, as the name suggests, you’re not bound by an expiration date. This is the kind of derivative contract that Millionero offers.



Benefits of Crypto-Backed Derivatives


Crypto-backed derivatives hold several benefits over cash-backed derivatives that most exchanges offer today. For example, if you already hold some Bitcoin or Ether, you don’t need to sell them for cash in order to put up the margin for a new trade. You can straight away use your crypto holdings as collateral and make your trades.


And of course, there’s the benefits of perpetual crypto derivatives themselves over regular/traditional asset derivatives:


- 24-hour trading: The 24-hour nature of crypto markets means you can trade crypto-backed derivatives around the clock.


- Product categories:  Most market participants in the crypto market are still retail investors, who are less sophisticated than institutional investors. Hence, the crypto derivatives market also offers less complicated products like options, futures and perpetuals, suited to the participant's profile.


- Access to the market: Unlike conventional derivatives, crypto derivatives provide more market access to the participants in the crypto market. Trading in crypto-backed derivatives is open to everyone having a wallet address and certain assets. DeFi has eliminated individuals' need to divulge their private information to participate in the market.


- Innovation: With DeFi getting more popular, new financial initiatives appear on the crypto markets every few days. Compared to crypto derivatives, traditional derivatives haven't changed for the better, according to market demands. Crypto-backed derivatives are always undergoing innovation to induce better products.


Now we get into why Millionero’s crypto-backed derivatives might revolutionize the world of crypto trading.



Millionero's Crypto-Backed Derivatives

So, why trade Millionero's crypto-backed derivatives? We can give you a number of reasons:


- Leverage: Millionero’s Perpetual Max is a feature that offers you to trade using 100 times the fund you initially deposit. So  you can put up a small amount of money to control a much larger position. Keep in mind that this can magnify both profits and losses, so it’s important to use leverage carefully.



- Broad Range of Crypto Pairs to Choose From: On Millionero, you get to pick your favorite from quite the diverse range of cryptocurrencies, including BTC, ETH, MATIC, XRP, BAT, AAVE, ADA, and more. This allows you to get exposure to a wider range of crypto assets, and take advantage of price movements more efficiently.


- Easy to Comprehend Display of Data: Another plus point for crypto perpetuals on Millionero would be how easy it is to understand all data relevant to your trades. Along with your free balance- as in the funds you still have to open more positions, you can see information such as equity, and your total P&L (profit and loss) of all trades.  

- You Can Trade Comfortably as a Beginner: Even if you know next to nothing about crypto perpetuals, Millionero can help you out in executing a trade. Sign-ups and fund deposits are the simplest things with Millionero’s easy-to-navigate platform, and you even get a number of options to fund your account. On the crypto perpetuals trading page, all you need to do is select a trading pair and decide whether to buy or sell, and how long you want to keep your position open for. Just like that, you can start with crypto perpetuals trading.



Default Setup: Keeping the risks attached to leverage in mind, Millionero even automatically sets your default setup in crypto perpetuals - from a leverage of 3x to auto-filling your amount based on your available balance. All to minimize the risk factor for you and make the trading experience a breeze. This certainly makes Millionero one of the most beginner-friendly crypto exchanges.





Long story short: with helpful features like a default low leverage, easy order placements, and technical indicators, trading on Millionero is a no-brainer even for an absolute beginner. If the crypto derivatives market interests you, Millionero can definitely make for the best exchange you can pick to get you started.


Sign-up on the official Millionero website today to start trading crypto perpetuals! You can also find the team on Twitter, Instagram, Facebook, and LinkedIn.

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