Crypto Daku Robinhooders AMA with EMX Co-founders

Posted by EMX Team on Aug 26, 2019 2:08:33 PM

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NOTE: The EMX Token Sale on ProBit has been cancelled since this article was first published. Please join our mailing list or Telegram Announcements channel to keep updated with the latest.

EMX co-founders Jim Bai and Craig Austin did an AMA with the active and engaged community of altcoin enthusiasts, Crypto Daku Robinhooders, on August 13, 2019. Below is a transcript of some of the best questions:

Q: Please mention the 3 best features of EMX, which makes it ahead of its peers?

Jim: 1) On EMX, you can trade more than just crypto markets. You can trade gold, US500 (US equity market), the Euro - alongside BTC, Tezos, etc. So, it's a platform that's more similar to what professional traders are used to. Having all the worlds markets available on one platform. 2) We have a strong UI/UX and try to make the site easy to use for beginner traders. 3) We have fair markets. We use an auction based matching engine to make sure that small traders don't get taken advantage of by larger traders. We can talk more about that later.

Q: Will we be able to buy equities using Bitcoin at your platform?

Jim: Yup, right now, you can buy our US500 index, which tracks the largest 500 equities in the US, using BTC as collateral.

Q: Can we expect EMX to support more equity markets in the future?

Craig: Yes, definitely. I think it'd be awesome to get simple, cheap exposure to US, Japan, Korea, Germany, UK, Brazil, etc. We'll be adding those. We'll be speaking w/ our active traders and biggest token holders about what contracts to list next.

Q: I am a crypto investor and I only care about cryptocurrency futures contracts, tell me the reason why I should choose your exchange platform instead of existing ones like BitMEX or Binance? What is your exchange’s advantage that can convince me to change from my favorite exchanges?

Craig: This is an interesting (and common) question. We'd like to give crypto futures investors like you more options to express views on the market - in more detail than they can today. If you're worried about trade wars or market instability, rather than just "long BTC", you could be long BTC and Gold, or long BTC and short US equity markets. All of that is available on EMX. And with diversification comes a better risk/reward balance - so (hopefully) better trading outcomes!

Q: How different is EMX from BitMEX? Will there be more liquidity than Bitmax and Binance?

Jim: The goal is to get there one day. We are built differently than BitMEX, both front end, back end, all of which improves the trading experience for users. No more system overload issues, no more UI from the 90s. We also allow for more contracts, including traditional ones like US500, gold, EUR/USD.

Q: Whenever there is a big fluctuation in market BitMEX faces server overloads problems. Did you do stress testing for your system and was there any issues like this?

Craig: We built a frequent batch auction matching engine to address this very issue. By crossing traders in 1 second batches, we can easily scale and handle the volume that BitMEX can't using their technology.

Q: It is known that the EMX team consists of experienced quantitative traders, exchange officers, market producers, FCM employees and engineers. Is this an advantage for EMX?

Jim: Building a stable, robust, feature rich derivatives exchange is very challenging. The experience our team has gives us a leg up to meet these challenges. We're proud of our background and what we've built, and are excited to bring more to the worldwide trading community.

Q: What is your vision about the future of trading?

Craig: We think the global community of traders that have been attracted by crypto volatility over the last few years do not have very good tools. We want to provide better tools - more like traditional investors benefit from - and "level the playing field." That's where we see the space going. Large, well-funded companies (like Bakkt/CME and others) sometimes focus on the big money-makers (institutions in the US, for example) - and don't provide good solutions to others. And the solutions for the small/medium trader audience are often not reliable and unsafe (as we've seen in crypto at times so far) - so there's a HUGE opportunity to improve that. Our investors and partners see that opportunity.

Q: What does your roadmap for 2019-20 look like? Name some important milestones you are hoping to achieve?

Craig: We have a lot in store for 2019 and beyond. Right now we offer BTC, XTZ, US500, Gold, and EUR/USD contracts. We will roll out more contracts soon. We also will launch our exchange token, and a spot exchange as well, to trade EMX spot. We've been getting lots of feature requests as well, with mobile being a big one we want to release in Q4.

Q: EMX is the first exchange that has facilitated trading of commodities and equities along with cryptos. How do you plan to overcome the regulatory concerns while providing such a feature? Have you already received any regulatory license for your exchange?

Jim: We are working with our GC, who was the first general counsel, for ICE (Intercontinental Exchange), to help us get registered and regulated. We don't accept US traders today, but the goal is to accept them after getting our CFTC licenses in the medium term.

Q: What are the potential challenges do you foresee EMX will face in the future? And how will EMX overcome these obstacles?

Craig: We think regulation is going to be a big deal (ie, CFTC's investigation of BitMEX). That's why we've focused on doing what's best long term (KYC/AML on all traders) and have hired a General Counsel to work on regulatory strategy.

Q: Will EMX provide an OTC platform too in the future ?

Craig: OTC and block trading are good ideas for the future. Other platforms have been successful with those. We're focused on the retail and API exchange trader experience at the moment.

Q: Could you please explain more about your auction based matching engine?

Craig: Sure, we've implemented a frequent batch auction matching engine is based on a U Chicago professor, that is more fair and better able to scale. Crossing is done periodically, currently every second, and everyone pays the same price each auction, the price that crosses the most number of traders. It's more fair because people submitting within the same second have the same time priority (so racing to be 1ms faster isn't rewarded).  And it's better from a tech perspective, because we can match/cross at once, allowing us to scale much more efficiently. We're excited for the auction based model to become more popular. From a trader perspective, it looks and feels the same as a traditional continuous market (feels just as fast) but behind the scenes, it's more fair.

Q: You must know the importance of having a reliable system during those high volume and crazy price movement times. Have you tested yours? How is your performance?

Craig: Our batch auction-based matching engine helps a ton here. No matter how many trades occur during a period, we cross them all at the same time - and at the same price (within a short time-frame). Huge scalability benefits of that. That helps us stay up and responsive during volatile times when other platforms may struggle. It also provides a more fair market.

Q: Safety and security are always the most concerned issues. So how is the security level of EMX? And what technology does EMX use for the best security for users?

Craig: Protecting the safety of trader's deposits as well as our exchange's matching engine and other systems are the most important job we have. We've partnered with BitGo for crypto custody - an industry leader. Our team has experience building cloud systems at hedge funds, Amazon, Microsoft, and startups around Silicon Valley - so we've built a platform we're proud of.

Q: Will the exchange liquidity be provided by only you? Do you have plans or agreements with external liquidity providers?

Jim: We have an internal mm desk providing liquidity to the exchange now, and are speaking to several third party market makers about joining us. Currently we've bootstrapped by providing liquidity ourselves, but of course our goal is to source external liquidity. Others can do that better than we can.

Q: Will your platform offer the option of copying trades of top traders for a certain fee?

Craig: This is an excellent idea. Yes, adding more social features (follow trading, or even counter trading 🙂) to make the platform more of a "community" while you're trading are great ideas and we're investing there. That starts with our competitions - but will evolve into more ways to share and even earn. Sign up for an EMX account and stay connected! We'll email when we release new markets, features, and competitions.

Q: Can you clarify the seed vesting. I read it is 2-6 months tbd (source DiddyCarter review). Better than private sale actually?

Jim: Some of our seed round backers purchased in 2017, so they have been with us for almost 2 years.The average price was about 6.5 cents, and their vesting is anywhere from 6-2 months (with the first 5% buyers in Sept 2017 having no vesting). We are speaking to one large supporter to extend their vesting beyond 6 months (this has since been extended to 12 months). Also, the seed does not get anything upfront.

Q: What is the locking period of EMX token for private investors, team?

Jim: The current round has a 10% upfront, and 15%/month for 6 month vest. The team has a 4 year vesting, with a 1 year cliff. We are in this for the long term 🙂

Special thanks to the Crypto Daku community for this fantastic AMA. If you have any other questions for Craig, Jim and the EMX team, be sure to join our Telegram (available in Korean, Portuguese and Chinese too!).

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Topics: EMX Team