AnchorExchange — a game changer in the crypto trading space

Introduction

The objective of this article is to introduce main features of AnchorExchange with emphasis on how everage user can profit from using it. But what actually AnchorExchange is?

Being the newest flagship product of the AnchorFinance ecosystem, AnchorExchange is a decentralised leverage trading platform with a unique earning module. If you are not familiar with these terms — don’t worry. We will go through it step by step.

Decentralisation

Decentralisation in blockchain terms refers to the transfer of asset control and decision making from a centralized entity (person, government, organization) to the owners (in case of assets) or to the owners and community members (in case of decision making) Crypto DeFi (Decentralised Finance) solutions eliminates intermediaries by allowing users to execute financial transactions through blockchain smart contracts technology, profiting from its immunity (irreversibility of entered data), transparency as well as security protocols. And what does it mean for users of AnchorExchange? In simple words, you have control over your assets that are stored in the blockchain, and nobody else can access and manage them. It is only you who can deposit or withdraw them, claim interests or open trading positions. Obviously with an assumption of such basic security rules, like no sharing your wallet private key or mnemonic phrase.

Leverage Trading

Leverage is the use of a smaller amount of capital (called a margin or commited value) deposited by a trader to be provided with increased exposure to a traded asset. Let us give you two examples.

1. Long BNB position of 100 BUSD with leverage 10

If you forecast the growth of BNB price and want to buy it with 1000 BUSD but using only 100 BUSD of your capital then you open a so-called long BNB position of 100 BUSD with leverage 10. If the price of BNB increases by 7%, your position value increases from 1000 BUSD to 1070 BUSD, i.e. by 70 BUSD. Because you committed only 100 BUSD, your real profit will be around 70%! (corrected by fractional fees).

If the price of BNB decreases, then you can close the position, accepting the loss. You can also wait until the BNB price reverts and starts to grow. But be careful, if the BNB price trend is opposite to your forecast then you risk to reach the limit of your position and get automatically closed paying your liquidation fees.

2. Short ETH position of 100 BUSD with leverage 5

If you forecast a decline of ETH price and want to bet it with 500 BUSD but using only 100 BUSD of your capital then you open a so -called short ETH position of 100 BUSD with leverage 5. If the price of ETH decreases by 8%, your position value increases from 500 BUSD to 540 BUSD, i.e. by 40 BUSD. Because you committed only 100 BUSD, your real profit will be around 40%! (decreased by fractional fees).

If the price of ETH increases, then you can close the position, accepting the loss. You can also wait until ETH price starts to decline. But again, be careful, if ETH price trend is opposite to your forecast then you risk to reach the limit of your position and get automatically closed paying your liquidation fees. Just remember. Higher leverage — higher chance of profits, but also higher risk of partial liquidation. But don’t worry. Before opening your position, the platform will calculate the liquidation fees, so you can accept, adjust or reject this position. All with full transparency! So, is AnchorExchange only for the traders?

The short answer is NO.

Following AnchorFinance motto ‘Crypto for Everyone’ we also prepared features for community members who are not into the trading.

The Earning module of AnchorExchange to which we refer as AnchorEarn, is a unique function allowing to stake leading crypto assets, like BTCB (Binance wrapped BTC), ETH, BNB, BUSD or CAKE to earn the assets you stake. So no longer hyperinflationary and occasionally tokens to claim, you stake ETH — you earn ETH, you stake BTCB — you earn BTCB, you stake BUSD — you earn BUSD etc. And all this with very competitive APRs.

You can ask how maintainable these incomes are and for how long I need to stake my crypto assets? Well, the answer to the first question is simple. More trade volume is generated, more interests are accumulated to share among the stakers. Long trading position fees feed interests of BUSD stakers, whereas short trading position fees feed interests of other respective crypto assets. Concerning the stacking period, it is flexible. No longer weekly, monthly or quarterly staking periods to commit.

Summary

In summary, AnchorExchange is a unique decentralised trading platform, where traders can use leverage for their trading capital and stakers can profit from the passive incomes generated by trading fees.

In the next articles you will find more details about functionalities and features of AnchorExchange with focus on the Earning module. So stay tuned!