Phemex

Phemex Launches Leveraged GOLD Contracts to Hedge Bitcoin Risk

Phemex - Bitcoin RiskPhemex, a Singapore-based cryptocurrency derivatives exchange, has launched a proprietary perpetual contract pegged on gold, Leveraged GOLD and settled in nominal USD to hedge bitcoin risk. This is the first GOLD/USD perpetual contract that can be traded with up to x100 leverage.

This novel product was introduced in order to help users hedge their risk with as many options as possible in the context of Bitcoin’s recent volatility. Perpetual contracts trade at close to the underlying market price for bitcoin, because of a funding mechanism that requires long and short contract holders to exchange payments every eight hours.

Jack Tao, Chief Executive Officer at Phemex, commented: “This is just the beginning for non-crypto assets on the Phemex platform, the roadmap for 2020 includes stock indexes, interest rates, FOREX, commodities, other metals, and energy resources.”
Each contract is worth 0.001 troy ounce of gold. The price is determined by the combination of several indexes: 1Forge.com (40%), GoldPrice.com (20%), itBit.com (15%), Bitfinex.com (15%), and Kraken.com (10%). This index is updated and published every second. If any of the sources disconnects, it will be temporarily removed from the calculation until a connection can be re-established. The weight of the disconnected source will be proportionally reallocated among the remaining sources.
Phemex is led by eight former Morgan Stanley Executives and leverages a “User Oriented” approach to develop a design criteria that consists of <1ms latency speed, >300k transactions / second, and >99.9999% availability, according to the crypto derivatives exchange. Phemex will also support FIX API, sub-accounts & L3 market data.
The operator allows the trading of crypto contracts backed not only by crypto assets, but also by traditional financial products, such as stock indexes, interest rates, FOREX, commodities, metals, and energy. Its proprietary Hierarchical Deterministic Cold Wallet System assigns an independent deposit address to each user, so that all assets are kept in cold wallets.
Jack Tao, the CEO of Phemex, worked at Morgan Stanley for 11 years as VP Software Engineer based in New York. There he was responsible for BXS, Equity algo trading in US, Dark POOL, Smart Order Router and algorithmic trading engines’ development for Asia Pacific markets.