Crypto Hedge Trading
We have released a demo-version for BANKEX Trading Demo
In this screencast, we’ll show you how to use the BankEx Trading application to trade Ethers for dollars. This application allows you to hedge high Ethereum volatility risks.
Demo-version is working on WebKit-based browsers.
In order to use the demo you should install the MetaMask plugin https://blog.bankex.org/how-to-buy-ethereum-using-metamask-ccea0703daec first and get Rinkeby testnet https://faucet.rinkeby.io/
Where to start
In the application interface we can see our balance in the window here in Ethers to dollars. Next, we see the exchange rate for Ethers from the automatically updated from the exchange. You can also trade Ether to Bitcoin.
Then we can place an order. You might want to ‘SELL’ in two cases: 1) when you are relying on the decreasing exchange rate between Ether and dollars and want to make a profit from this, or 2) when you have Ether and want to know their dollar value. You might have incentives to buy for when you want to make more profit from the growth of the exchange rate between ETH and the dollar.
After placing the order we see that the size of the position will change. Also, we can go to the hash of the operation and we can see the source of the transaction, that is the address of the user MetMask wallet who just conducted the operation. We can also see where the transaction will be sent. Here we see that our transaction was sent to the wallet of the contract that has the code of this demo version.
Currently, Ether is used for the transaction, however, if you use BKX tokens, there will be no Ether commission.
Use concept of Virtual contracts
This implementation relies on new concept of virtual contract which is a low footprint oracle-driven smart contract for Ethereum network.
Typical Ethereum smart-contract is a state-machine which is tracking internal state of every variable. Each variable is accessible by smart contract's functions and/or by external observers.
Although this is convenient tho have self-sufficient contract a large fratcion of contracts on practice can't exist autonomously requiring external data-sources called oracles to provide them with outer-world data.
The idea of proposal is to discard internal in-contract data storage for oracle-driven contracts drastically reducing storage/modification costs. On the other side this approach remains all pros of blockchain infrastructure because all contract's function calls are already stored on blockchain forever.
So the general idea of proposed virtual contract is to call it's function in normal way but not writing the state to contract itself. Contract state is tracked inside of oracle and can be re-created by everyone.
Congratulations! You have just hedged your risks.