FTX and Paradigm jointly launch "One-Click Spread Trading" product, allowing users to arbitrage and hedge with just one click.
FTX and institutional liquidity integration platform Paradigm have jointly launched a one-click arbitrage trading service, with trading pairs including popular cryptocurrencies such as Bitcoin, Ethereum, SOL, and Dogecoin.
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What is Spread Trading?
Spread trading involves taking advantage of price differences between different futures contracts with varying expiration dates, or between perpetual contracts and spot markets. This phenomenon allows many traders to simultaneously long and short contracts of different maturities for arbitrage purposes, or to buy spot assets while shorting perpetual contracts to earn funding rates.
This trading strategy does not involve trading the assets themselves, but rather exploiting the price differences between two assets for arbitrage opportunities.
The newly launched innovative product simplifies the process for users with a one-click design. Previously, trades required separate selling and buying actions, but the one-click design reduces fees by 50%. Additionally, the high liquidity of Paradigm reduces trading slippage.
Furthermore, as the prices of trading pairs are settled in real-time based on FTX exchange prices, users can almost engage in risk-free arbitrage if there are price differences between contracts or trading pairs.
Lastly, Paradigm's spread trading product integrates FTX's liquidity. Compared to traditional order book spreads, this product has lower structural risks, allowing market makers to quote more precise prices and larger volumes.
Paradigm CEO Anand Gomes summarized:
"FTX and Paradigm have a long-standing partnership. I am excited to collaborate in enhancing the crypto ecosystem together. As spread trading products become a tradable asset class on FTX in the future, we should see more new investors being attracted. Looking ahead, combining the expertise of both companies in users and products undoubtedly will bring more synergies and spark new products and services."