FTT is an ERC-20 utility token that was created on the Ethereum platform. The token carries out several functions in the ecosystem of the platform.
The token was issued by the exchange FTX that was launched in July 2019. The platform offers several innovative trading products for its users with BTC options, 20 perpetual swaps, more than 45 leveraged tokens, prediction markets, MOVE contracts, etc. Holders of FTT get many benefits and can use lower fees on the services offered to them by the community.
The company behind the project is FTX Trading LTD that is incorporated in Antigua and Barbuda. However, the main office of the company is located in Hong Kong. The goal of the resource is to create a platform for traders and develop new products and tools for professional and institutional traders. However, trying to meet the demands of different users, the developers try to make the trading platform intuitive for first-time users as well. The project was incubated by Alameda Research before it was launched.
Being a utility token, FTX token serves its goals strengthening the FTX ecosystem. The customers can get benefits in this way and enjoy lower trading fees along with socialized gains from the insurance fund.
The platform uses the liquidation engine developed by the in-house team. It was designed to prevent a clawback mechanism. The exchange launched many innovative products such as MOVE contracts, leveraged tokens, perpetual futures on popular cryptocurrencies, a single universal margin wallet for derivatives trading, and more. It also introduced an automated OTC desk for traders buying cryptocurrencies in bulk.
The company offers white-labeled solutions of the OTC portal and futures exchange that can be purchased for FTT. Though the platform is still developing, it has already feature-rich functionality as it continues to add new products and features. At the time of writing, the platform plans to launch a spot exchange with FTT used for initial exchange offerings.
FTX token is one of the tokens that can be traded on the exchange along with Bitcoin, EOS, Ethereum, Tether, ChainLink, Ripple, Tezos, LiteCoin, Huobi Token, Binance Coin, and many others. The platform functions as a cryptocurrency exchange, but fiat transactions are also allowed. However, they are available only for users who are Level 3 KYC verified.
FTT financial details
FTX is a utility token that supports the ecosystem of the FTX cryptocurrency exchange. In particular, it is used for fees and can considerably decrease users’ expenditures. It’s possible to reduce the fee for FTT holders, while the percentage of discount depends upon the amount held.
For instance, if FTT holding equals to 100 USD, it reduces FTX fees by 3% but doesn’t provide any other privileges or discounts on FTX OTC. If FTT holding reaches 1,000 USD, the discount on FTX fees becomes 5%, also without any other perks. However, the perks appear after the amount of holding grows up to 5,000 USD. In this case, the discount on the FTX fees reaches 10% and the discount on FTX OTC service becomes 0.0025%.
The figures gradually grow thus raising the discounts on FTX fees and FTX OTC trading. With 1M USD held, the person gets a 40% discount on FTX fee, 0.0150% discount on FTX OTC, and automatically obtains tier 4. With 2.5M USD, the FTX fee discount becomes 50%, FTX OTC discount reaches 0.0200% while a user automatically becomes a VIP client. But even this level can be improved for those who are ready to hold 5M USD. It provides a 60% discount and again 0.2% discount on FTX OTC. The status of a user automatically becomes VIP2, hence provides even more benefits.
Being the backbone of the ecosystem, FTT was designed to increase network effects. The team worked carefully to come with complicated incentive schemes motivating the members of the community to use the native token. The scheme was devised to increase the demand of the FTX token, and reduce its circulating supply. For this, the company introduced the token burn system. The platform spends a part of fees to repurchase FTT to burn it. The process will continue until at least half of FTT is destroyed.
The employees of the company perform buy-backs on a weekly basis and then burn the tokens. The amount of these tokens reaches 33% of fees generated on FTX markets, 10% of additions to the insurance fund, and 10% earned from some other services on FTX exchange. FTX token can also be used as collateral on the margin account just in the same way as the stable coins supported by the platform. The platform is in partnership with some stable coin providers such as Circle, TrueUSD, and Paxos. The exchange allows users to deposit these coins to the account and use them as collateral.
FTX platform announced the seed round in August 2019, when it raised 8 million USD. The following investors participated in the seed round: Proof of Capital, Galois Capital, FBG, and Consensus Lab, which was the lead investor. The corporate round took place in December 2020, when Binance was the only outside investor. The amount of the investment wasn’t disclosed. The Series-B round was announced in March 2020 when the company received investments from Liquid Value to cover its expenses on aggressive expansion plans, a new streamlined mobile app, and other purposes. FT token can’t be purchased by users of the US and is also restricted for some other jurisdictions.
The platform is led by CEO Sam Bankman-Fried, COO Andy Croghan, and CTO Gary Wang. The team of the company includes specialists who worked for large Wall Street and famous tech companies. There are former Google and Facebook employees among them. With good expertise in equity derivatives trading, they have all resources at their disposal for the development of a leading exchange in this segment of the market.