The world’s largest stablecoin by market capitalization, Tether (USDT), has today launched futures contracts on two derivatives platforms, Bybit and KuMEX.
Established in March 2018, Bybit is a Singapore-based cryptocurrency derivatives exchange. It hosts perpetual contract products for several US dollar (USD) exchange pairs, including Bitcoin (BTC), Ethereum (ETH), Ripple (XRP), and EOS.
KuMEX is the derivatives trading platform of popular crypto exchange KuCoin which is backed by leading investment firm IDG Capital. “KuMEX is committed to building a simple, reliable and transparent futures platform. The USDT Perpetual Contracts will make it clearer and easier for new futures traders to make investment decisions using USDT, and mitigate the volatility brought by non-pegged tokens,” said Johnny Lyu, CEO of KuCoin.
Launching new perpetual contract products on these two exchanges exhibits Tether’s continued drive to grow and expand its reach. Despite some ongoing controversy, Tether remains the most stable, liquid, and trusted stablecoin on the market. As the most trusted digital-dollar equivalent for instant online trading, it is now the most used cryptocurrency in the world.
These new perpetual contract products will provide Tether users with more options. Traders can hedge their positions by using perpetual contracts to hold both long and short positions at the same time. This gives greater flexibility to portfolio management and further solidifies the importance of USDT in the cryptocurrency space.
“I’m delighted to see that Tether USDT is once again the trusted choice of the growing derivatives industry,” said Tether CTO Paolo Ardoino. “Bitfinex, OKEx, and other major exchanges have already launched derivatives products that use Tether USDT for collateral and settlements. We see more exchanges are following month after month.”
Despite months of weakening markets around the world, the total market capitalization of Tether continues to grow. Since February last year, we have seen USDT triple in value from only $2 billion to over $6.2 billion today. The company, which already has partnerships with Algorand, Ethereum, EOS, Liquid Network, Omni and Tron, continues to explore new ventures.
A perpetual contract is a special type of investment product derived from futures contracts, which is basically a predefined agreement to buy or sell an asset on a certain date for a set price. However, with perpetual contracts, no predefined date is set and trading is based on an underlying Index Price which is an average according to spot markets and volume.
The advantage of using perpetual contracts is that the price is always very close to current spot markets, and you can hold your positions as long as you like. This can be particularly attractive in highly volatile markets like cryptocurrency.