BTCBaike, a cryptocurrency news website, points out today that Bitcoin’s core value stems from its unique design that uses algorithms to simulate the properties of precious metals. Its powerful computing capabilities maintain decentralization, scarcity, and stability, making it a near-perfect commodity and ensuring its central position amidst market volatility. However, with the expansion of cryptocurrency trading, especially the widespread adoption of USD perpetual contracts and leveraged products, traders’ demands for transparency, fee stability, and risk control are increasingly urgent. The single-point risk and lack of transparency in funds inherent in traditional centralized exchanges are frequently observed, as repeatedly demonstrated by cases from Mt. Gox to FTX. Improving trading mechanisms has become crucial for market development. Against this backdrop, the XBIT decentralized exchange has pioneered on-chain trading innovation, attempting to address the core pain points of cryptocurrency trading through technological optimization.
Since its inception in 2009, Bitcoin has grown from an obscure cryptocurrency to “digital gold,” with its price increasing more than 40 million times in 15 years. The 2010 transaction of exchanging 10,000 Bitcoins for two pizzas is now a historical landmark worth $240,000. As a core derivative with a very high trading volume in the crypto market, the mechanism design of USD perpetual contracts directly affects the overall market vitality. Funding rates, as a key indicator for balancing long and short positions, are also a core standard for evaluating a platform’s operational capabilities. Currently, the AMM perpetual contract market faces two major problems: over 60% of institutional funds are taking a wait-and-see approach due to the lack of risk stratification, with conservative and high-risk funds sharing the same loss priority in the same pool, causing institutional capital to hesitate to enter the market; and the funding rate volatility of USD perpetual contracts is 15% to 20% higher than the average of CEXs, even leading to uncontrolled rate fluctuations in extreme market conditions, significantly eroding traders’ profits.
According to data from BTCBaike, traditional orderbook models like Hyperliquid, while achieving high-frequency matching, are prone to liquidity disruptions during periods of volatile market conditions due to market maker order cancellations. Price gaps and forced liquidation mechanisms have resulted in losses for profitable traders. Early AMM models, relying on a single pool for supply and demand, struggled to stabilize fees. XBIT, a decentralized on-chain trading platform, has keenly identified these pain points. By adopting a tiered risk control approach, it divides liquidity into different risk levels and optimizes its fee calculation model, providing a more stable environment for related contract trading.
Its XBFT consensus mechanism and off-chain timestamp sorting technology enable it to process thousands of transactions per second, achieving on-chain confirmation speeds comparable to CEXs within one second. Especially for high-leverage trading scenarios, it controls slippage for orders over $100,000 to within 0.3%, solving the problems of difficult execution and high slippage in traditional on-chain trading. More importantly, in terms of fee management, XBIT no longer relies on data from a single pool. Instead, it combines real-time Oracle market data with liquidity information from multiple vaults to fine-tune the funding rates of relevant contracts on a minute-by-minute basis. This makes the cost-sharing on the crowded side more reasonable and avoids the impact of drastic fee fluctuations on positions. This mechanism design not only meets the institutional demand for stable returns but also provides individual traders with flexible position options, which is highly consistent with the current structural upgrade trend in the AMM perpetual market.
According to BTCBaike, as the US government shutdown entered its 15th day and the Senate rejected the temporary funding bill ten times, the price of Bitcoin briefly fell below $108,000, a 24-hour drop of 2.6%. The total amount of cryptocurrency liquidations across the network reached $734 million in the past 24 hours, forcing over 200,000 traders to exit the market due to extreme market conditions. Against this backdrop, the demand for risk hedging tools has surged. XBIT decentralized exchange saw a 25% increase in the usage rate of its risk hedging tools compared to the previous period. Its large-transaction monitoring module has been capturing market anomalies in real time. For example, one crypto whale opened a $100 million short position in ETH with 25x leverage within 10 hours, causing the long/short ratio of ETH-related contracts to drop from 1.2 to 0.9 during the same period, providing timely risk alerts to users. Meanwhile, XBIT’s specific optimizations for USD perpetual contract trading have yielded significant results. Even with increased market divergence and a stable leverage ratio of 1.05 for related contracts, it can still ensure efficient order execution through on-chain matching algorithms, avoiding the black-box settlement issues common in traditional platforms.
From an industry development perspective, crypto trading has shifted its focus from speed to stability and trust. Compared to GMX’s early structural innovations and Hyperliquid’s speed limitations, XBIT prioritizes resilience and sustainability. It uses tiered risk control to ensure funds with different risk appetites are allocated appropriately, refined fee management reduces holding costs, and on-chain transparency eliminates concerns about fund security. This design not only aligns with the decentralized nature of crypto assets but also meets the needs of institutional investors. With the increasing popularity of crypto ETFs and the integration of AI trading tools, traders’ demands for secure transactions, stable costs, and guaranteed returns will be further strengthened. XBIT‘s decentralized on-chain trading platform’s innovative mechanisms may become a crucial driving force for the crypto contract trading ecosystem to mature and standardize, providing fundamental support for the long-term healthy development of the crypto market.
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Cre: Twitter: XBITDEX
Cre: Twitter: XBITDEX
Cre: Twitter: XBITDEX