INTRODUCTION
Crypto exchanges have emerged the tool to profit from crypto asset ownership but they are far from being without their pitfalls. The exchanges as a centralized point of sale do not fit well with the idea of a decentralized financial system, they are a single point of failure but this is not the only issue. Some of the problems associated with crypto trading platform or exchanges are;
LIQUIDITY PROBLEMS
Like all nascent markets, there is a lack of liquidity in crypto markets making it so difficult to exit at the right price. The growth in exchange use has boosted overall liquidity but such an increase in trades is yet to have the ultimately desired effect. In Bitcoin markets for example, this lack of liquidity is compounded by the fact that many BTC holders are sitting tight as the value rises and are unwilling to put their Bitcoins back on the market.
Those holding crypto and waiting for their assets to reach a certain profit level subsequently flood the market which accounts for the volatility and massive price swings that we see on crypto markets and this is where proposed futures markets can really help.
This will facilitate the shorting (selling) of Bitcoins that are not actually held by the seller but are contracted to be sold and then bought back later at a lower price. This may bring stability to crypto markets as it increases trade volumes and could balance out the current bullish trend on the market. Price slippage woes are compounded by the fact that many crypto exchanges require users to wait for their transactions to be confirmed and these waiting times can be several minutes.
Moreover, the lack of liquidity carries two main problems for crypto exchange users which are, large spreads on the thin markets due to the low number of bids for the assets, in addition to demand and supply inefficiencies and the second problem is the large price swings on these thin markets which mean price slippage occurs with trades not executed at the price proposed.
CENTRALIZED NATURE
As mentioned above, crypto exchanges constitute a single point of failure and so are a target for hackers, Mt. Gox the world’s leading exchange of its time is the most publicized and largest hack to date with uncovered Bitcoins totaling 650,000. Mt. Gox later filed for bankruptcy.
Blockchain data inputted is immutable, it is more susceptible to theft by hacks. This immutable nature means all transactions are final with complainants may as well taking their grievances to the appropriate place to be resolved. In addition to there stolen or lost funds, crypto assets cannot be recovered or frozen without working to reject the transactions.
CLEARING AND SETTLEMENT
Another issue with crypto exchanges is how transactions are cleared and settled through its various platforms. As cryptocurrencies exist within an unregulated space, clearing and settlement cannot occur through traditional, regulated channels, making clearing and settlement risks abnormally high.
Moreover, exchanges aren’t willing to act as anything other than a third party that only arranges trades between buyers and sellers. This means that they are not a direct counter-party to every transaction that takes place and so are not bearing much responsibility for what takes place on their platforms. However, it must be said that they do act as a counter-party where they can correctly make margin calls in time to recoup funds from the wrong sides of contracts.
LACK OF TECHNOLOGICAL CAPABILITY
There are many exchanges operating sophisticated platforms but as an analyst from Bank of America Meryll Lynch noted, “by and large these do not offer the same quality of technology as the large global exchange groups.”
The systems the analyst is talking about can cost up to 10 million USD to operate and maintain per annum with prices starting from $500k for smaller exchanges i.e the more expensive and advanced the technology, the more they are able to detect market manipulation and other fraudulent activities. Crypto exchanges in their current forms just aren’t able to do this.
INGOT COIN
INGOT seeks to be a pioneer in the financial industry providing innovative techniques and solutions to link global markets with global market participants.
Being in the financial market since 1993, INGOT Group witnessed firsthand multiple inefficiencies over the years. INGOT continuously works on providing all stakeholders an ever-growing broad range of innovative products and services globally, thus allowing it to gain sufficient expertise to link this knowledge to the new blockchain environment and create an all-inclusive and self-serving Ecosystem.
The IC Ecosystem will be based on the blockchain technology and will utilize Smart Contracts to facilitate the execution of different contracts, while eradicating the need for intermediaries and external interference that restrict investors from fully engaging in all markets. By adopting blockchain, its creating a specialized ecosystem that will substantially increase customers confidence, market liquidity and -most importantly- provide efficient market pricing and access to funds for all variety of stakeholders.
INGOT Coin will create a complete solution by integrating 6 core ecosystem components and providing a one-stop-shop for the digital asset, traditional asset and currency markets to solve all the above-mentioned challenges, thus, creating a link between the crypto market and the traditional market. The IC Ecosystem will establish 6 different components to work hand in hand under one umbrella, providing all community members the chance to capitalize on upcoming opportunities in all markets.
IC Wallet will be a blockchain based crypto wallet dedicated to working as a custodial for all cryptocurrencies in the Ecosystem. Participants will be able to use the wallet to send, receive and store cryptocurrencies available in the market with ease and security. The wallets will contain multi signature and cold storage systems to create a secure and reliable environment for all stakeholders. The wallet allows for transfer of tokens from and to the exchange and other wallets. Furthermore, the wallet will be integrated with the IC Digital Bank, allowing users to pay with fiat and settle with crypto and vice versa.
IC TOKEN ANALYSIS
The Exchange will charge a preferred rate on all transactions paid by its coin, compared to payments done by other major cryptocurrencies or fiat currencies. INGOT will distribute coin dividends once the company is mature and profitable. This increases the attractiveness of the coin in the initial phases and in the long run. The maximum number of tokens that will be distributed will be 120,000,000 IC. In case tokens were not all sold once all the ICO ends, all unsold tokens will enter a burning program as per the smart contract.
CONCLUSION
IC Exchange will be integrated securely with the IC Wallet, IC Brokerage and IC Digital Bank through a user-friendly platform, a full fledged cryptocurrency exchange. For more details on this project, the links below will be of help a lot.
WEBSITE: https://www.ingotcoin.io
WHITEPAPER: https://www.ingotcoin.io/documents/en/white-paper.pdf
TELEGRAM: https://t.me/INGOTCoin
ANN: https://bitcointalk.org/index.php?topic=3581009
TWITTER: https://twitter.com/ICOINGOT
FACEBOOK: https://www.facebook.com/ICOINGOT
WRITER BITCOINTALK USERNAME: lumibaba
WRITER BITCOINTALK ADDRESS: https://bitcointalk.org/index.php?action=profile;u=2151502
WRITER ETH ADDRESS: 0x83b1556667E1A776Db4Eb9e9373c5Ea1F3308a24
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