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Many exchanges have wide, illiquid markets for many asset pairs. Often this is hidden because the exchange does not make data publicly available. What steps has IVAX taken to promote narrow liquid markets?


IVAX will take three steps to enhance liquidity.

First, IVAX will incentivize Market Maker registration. Market Makers will have an affirmative obligation to provide markets meeting specific performance standards in order to retain their Market Maker privilege.

Second, IVAX intends to employ a patent pending asymmetric speed bump on all liquidity-taking orders to slow down trading a fraction of a second. IVAX currently plans for that to be one millisecond. The purpose of this speed bump is to protect all IVAX Participants and IVAX Market Makers from being “picked off” by latency arbitrageurs. This bit of protection will encourage IVAX Market Makers to provide tighter markets for greater size than they would otherwise be able to achieve.

Third, IVAX will provide its market data free of charge so that you can see the liquidity that exists on IVAX rather than have to guess.  

These three steps will place IVAX on par with the best practices for visible market data of equities, options, and futures exchanges. IVAX will go a step further by making this data available to everyone at no cost.

Many exchanges provide little or no visibility into their marketplace. What information will IVAX provide?


IVAX will provide the look, feel, and data that traders and investors are accustomed to find at a state-of-the-art regulated equities, options, or futures exchange. For each asset pair in real time, you will see a last sale data feed showing every transaction, the best bid and offer prices and size, and a significant portion of the depth of the limit order book.

Unlike most regulated exchanges, IVAX will provide this data to the public at no charge.

I have read stories about exchanges where customer assets have been lost or stolen and were not recoverable. Am I at risk for this at IVAX?


IVAX will be regulated by the U.S. Commodity Futures Trading Commission (CFTC), which will oversee the regulation of both the IVAX Exchange and the IVAX Clearinghouse. When you set up an account at IVAX, your account will be at the regulated Clearinghouse. Every day, Clearinghouse Rules will require it to reconcile all customer account balances with the underlying assets which the Clearinghouse holds in custody, and the results of that reconciliation will be published at Customer assets at IVAX will be safe and secure.

Unlike most unregulated exchanges, the IVAX Exchange will never touch your assets, and therefore cannot act to improperly use or withdraw your assets.

At some exchanges, transaction fees are quite high. What does IVAX charge?


IVAX will charge a single fee that covers order execution, clearance, and settlement. Compared to most competitors, IVAX’s fees are lower, particularly for small traders. The fee is based on three factors:

  • Customer trading activity. More active customers will pay a lower fee for a given transaction.
  • Whether the customer is providing or taking liquidity. Providing liquidity improves the quality of markets at IVAX. Therefore, trades where the customer provides liquidity will typically have a lower fee than trades where the customer takes liquidity.
  • The size (notional value) of the trade. This type of fee structure is common among digital exchanges with the exception of other futures exchanges.

In addition, IVAX will charge no transaction fee for registered Market Makers in their assigned asset pairs. Market Makers provide liquidity which benefits all market participants.

At some exchanges, the fees for withdrawing assets from the exchange can be quite high. What does IVAX charge?


IVAX will charge a fee to cover its out-of-pocket costs when you transfer cash balances to your external bank account or transfer digital assets to your external digital wallet. If you attempt to make a withdrawal from your account in the Clearinghouse which violates Clearinghouse Rules, the Clearinghouse will reject the transfer request and charge a fee.

At some exchanges, the fees for transferring assets into the exchange or an exchange-sponsored wallet can be quite high. What does IVAX charge?


To trade at IVAX, you will need to deposit whatever assets you will be delivering into your account at the IVAX Clearinghouse. If you trade through a futures commission merchant (FCM), your FCM will make the transfer for you. The IVAX Clearinghouse charges nothing to accept valid deposits. If someone attempts to make a transfer into the Clearinghouse which violates Clearinghouse Rules, the Clearinghouse will return the attempted deposit less a fee.

At some exchanges, the minimum order size is quite large. Does IVAX permit smaller transactions?


IVAX allows you to determine the size of your orders within reasonable limits. IVAX will accept orders which can be as small as about 10 U.S. dollars. In exceptional cases, when you are liquidating a position in an asset which holds less than 10 U.S. dollars in value, IVAX will accept the order to facilitate the liquidation.

I don’t have a way to buy bitcoin for U.S. dollars so that the quantity of dollars I have determines how many bitcoin I can buy. Can I do that at IVAX?


Yes. At IVAX you can determine which asset’s quantity determines when an order is fully executed. When you submit an order to exchange bitcoin for euro at IVAX, you will be able to decide whether the order is completed when your specified quantity of bitcoin has been traded or when your specified quantity of euro has been traded.

Other exchanges may give you this choice, but they achieve it through an economically inefficient process—by maintaining two different limit order books: one denominated in bitcoin and one denominated in euro. This results in economically inefficient “crossed markets” which are often not resolved by arbitrage because of excessively high transaction costs. IVAX has a pending patent to provide an efficient method to combine these orders into a single limit order book. This eliminates the need for arbitrage and eliminates higher costs for you.

At some exchanges, the number of digital assets or fiat currencies available for trading is very limited. What is the scope of IVAX’s offering?


Initially, IVAX will offer contracts to trade many combinations of the fiat currencies and digital assets we support. We will offer trading among fiat currencies (e.g., euro and U.S. dollars—EUR/USD), between fiat currencies and digital assets (e.g., bitcoin and euro—BTC/EUR), and among digital assets (e.g., bitcoin and Ethereum—BTC/ETH). As IVAX expands the number of fiat currencies and digital assets offered, we anticipate it will be among the broadest offering of such asset pairs anywhere.

At some exchanges, clearance and settlement are costly. What are clearance and settlement costs at IVAX?


IVAX only charges a small transaction fee. There is no fee for clearance and settlement.

If I acquire bitcoin at IVAX, will my financial interest in bitcoin ever expire?


No. When you acquire a position in bitcoin or euro (or any other asset) at IVAX, you have that position until you decide to liquidate it. Your financial interest in the price movements of such assets will not end unless you liquidate the position. It’s yours to hold or sell when you want, and never settles for cash.

At some exchanges, it takes an indefinite period of time to settle a trade; at others, trades settle on a scheduled basis. When do IVAX trades settle?


All IVAX trades will settle on a “Day Ahead” basis. For every trade, you deliver one asset in return for receiving another asset. These comprise an asset pair. At IVAX, all asset pairs are expressed by the symbols for each asset pair presented in alphabetic order. So, when you are trading euro for bitcoin—whether you are receiving or delivering the bitcoin—the asset pair is BTC/EUR. The first asset (BTC) will always settle immediately after the trade is made; the second asset (EUR) will always settle the next day. Although the second asset will not settle immediately, you will be able to trade out of that position immediately—just as you would be if it were an unsettled equities, options, or futures position.

Some exchanges require payment in full for each trade; others support margin trading. How will IVAX work?


IVAX will require 100% of the asset you will be obligated to deliver to be available in your account at the IVAX Clearinghouse before we accept an order. There is no margin trading. For example, if you are buying bitcoin with euro, we require 100% of the euro to be in your account when you place the order. While this may discourage some customers from trading on IVAX, the offsetting benefit is that there is 100% certainty that every trade you make at IVAX will clear and settle without delivery default risk. This lowers the cost of trading because you don’t need a guarantor standing behind your leveraged trade. We believe that having certainty that all trades will be settled on time is worth the tradeoff.

Most exchanges offer trading in multiple digital assets based on one currency (e.g., U.S. dollars or dollar equivalents). Will IVAX offer trading based on more than one fiat currency?


Yes. IVAX plans to start operations offering trading in multiple digital assets (e.g., bitcoin, Bitcoin Cash, Ethereum) based on U.S. dollars, euro, British pounds, and other fiat currencies. This allows many of our customers to use their “home currency” to trade without the cost and complexity of converting to U.S. dollars or converting back from U.S. dollars to their “home currency” when they want to withdraw funds. We plan to expand to about 20 fiat currencies, and 50 or more digital assets, over time.