Bitcoin Quarterly Delivery Contracts Launched on KuMEX

Bitcoin Quarterly Delivery Contracts Launched on KuMEX

KuMEX, the derivatives platform of KuCoin cryptocurrency exchange, announced the launch of Bitcoin quarterly delivery contracts on October 31, 2019. The announcement comes shortly after the confirmation of monthly Bitcoin futures contracts made during the Blockchain Life 2019 Forum held in Moscow, Russia. 

Quarterly Bitcoin Contracts

KuMEX, the KuCoin branch focused exclusively on derivative futures contracts launched in July of this year, has expanded its service offering with the introduction of  Bitcoin quarterly delivery contracts available starting October 30.

This new product differs from the contracts already present on the platform. To start, the contracts will have an expiration date and the settlement will be executed based on the underlying asset following a set of pre-specified rules.

According to the announcement on Medium, the delivery date of the KuMEX Bitcoin Quarterly Delivery Contract is the last Friday of the contract month. The price will be established based on a Time Weighted Average Price (TWAP) of 30 times taking as a reference time value 12:00 UTC on the delivery date.

An Attractive Platform for Traders

Although KuMEX was launched just over two months ago, its features have allowed it to earn a significant userbase. KuMEX contracts are listed against the US dollar with a 20x leverage that is very attractive to traders. Furthermore, to reduce liquidity problems, the platform establishes a negative maker fee of – 0.025 percent, a unique feature in the crypto derivatives market.

The Bitcoin price is calculated based on a weighted average Bitcoin price taken from six exchanges which are: Coinbase Pro, Bitstamp, Kraken, Gemini, Liquid, and Bittrex. By calculating the Spot Index in this way, KuMEX guarantees a fair price at the same time reducing the liquidation risks in case of low liquidity.

Crypto Derivatives Products Are Rising

Crypto derivatives are booming, leading to a more sophisticated market and greater liquidity. Almost all major exchanges offer services of this type, including Bitfinex, or OKEx. Following these developments, cryptocurrency data aggregator websites are also offering products that allow investors to keep track of the derivative market. This is the case with CoinGecko which has recently launched a derivatives tracker that currently lists around 100 products from over 20 derivatives exchanges.