FTX

FTX Review

Pros

• Advanced trading offers
• Large amount of crypto offerings 
• NFT marketplace

Cons

• US version of the site is reduced

About FTX

FTX is one of the largest crypto exchanges out there. They offer advanced trading options such as derivatives, leveraged and futures trading. They also have staking options and an NFT marketplace, making this a well-rounded crypto exchange. It is widely available, but not in the United States, unfortunately. 

Staking

At the FTX Exchange, you can stake FTX Token (FTT), the exchange's native and governance token.  By staking this token, you can participate in decisions on the exchange and enjoy a number of extra benefits, including reduced trading fees. 

The site lists the following benefits of staking FTT:

• Increased referral rates: referrers that stake FTT are paid a higher fraction of their referees' fees
• Maker fee rebates: stakers get maker fee rebates (in addition to the standard FTT fee discounts) . These rebates stack with MM-level-based maker rebates.
• Free swag NFTs: stakers can spin the non-fungible swag wheel for a chance to win a free NFT, redeemable for FTX-themed swag or resellable at the NFT marketplace.
• Bonus votes: stakers get bonus votes in our polls (in addition to the standard number of votes, based on FTT held and trading volume)
• Increased airdrop rewards: stakers get increased SRM airdrops (and potentially later other airdrops and yield)
• Waived blockchain fees: stakers get a number of free ERC20 and ETH withdrawals per day
• Waived fiat fees: stakers get an extra free fiat withdrawal per week
• IEO tickets: stakers get tickets for IEOs hosted in FTX

You can also stake other tokens with FTX. Instead of all these benefits, you can simply earn an APY (applied percentage yield). Here are the three cryptos you can stake and the APY you will receive. 

• Serum (SRM) - 4%
• Solana (SOL) - 6% 
• Ray (RAY) - 20% 

FTX Fees

Trading Fees

FTX has the same fee structure for spot and futures trading. That is to say, you pay the same whether you are trading in the moment (spot) or setting up a contract to buy a cryptocurrency at a certain price. We like that they offer this simple fee structure. 

Trading fees are divided between two, the maker fees and the taker fees. Here the maker fee is 0.02% and the taker fee is 0.07%. This can be lowered down to 0.0% and 0.04% respectively if you are trading large volumes. 

You can also stake FTT, the exchange's native token, and get your maker's fees reduced to 0 by staking only 25 FTX tokens, (FTT). They entered into a partnership with Paradigm - a leading institutional liquidity network in August 2022. Users trading through paradigm will be eligible for a 50% discount in fees while trading spreads.

These fees, in total, are roughly in line with the industry average according to our Q1 2022 Empirical Fee Study, which found the industry average contracts trading fee to be 0.0594% for takers and 0.0242% for makers. 

Withdrawal Fees

This exchange does not charge any withdrawal fees themselves. However, as always, there are network fees involved when making a transaction. This means that the only fee you need to be concerned with when withdrawing from this platform is the network fees paid to the miners. This withdrawal fee, or rather lack of withdrawal fee, is below the industry average and very competitive.

Overall, the fee level here is very competitive and consumer-friendly.

FTX has a Climate Commitment

FTX has a strong commitment to fighting climate change. They have a four-part plan to not only reduce their impact but contribute actively to the betterment of the environment. 

Their climate plan has four phases:

1. Meet their goal of becoming carbon neutral by the end of 2022
2. Donate to research that will have an outsized impact on the climate
3. Support carbon removal and storage solutions
4. Support additional projects that do not fit into the other categories, with a particular focus on the ocean.

Given that some cryptocurrencies, mainly those that use the heavier proof-of-history verification system, have gotten some press for being a burden on the climate, it is great to see some concrete initiatives from FTX. So far, they have donated at least $1,500,000 to climate initiatives. 

Additional Charitable Contributions

FTX is active in a number of charities. They earmark 1$% of all fees to be donated to charities. At the time of this writing (May 2022), they had earmarked nearly $21 million to be donated to a number of charities. These charities include: 

• Oxygen for India
• Clean Energy Innovation
• Good Food Institute
• Pachama
• GivingGreen.earth

Tokens Available

FTX.com has plenty of tokens available. At more than 200, they are constantly adding the latest tokens. It is great to have this type of early access, so you can hop on the hottest trend as it takes off.  This is definitely on the higher end of crypto exchanges. 

The US version of this exchange has a much smaller collection of tokens for now. Though they are adding new cryptos for their users in the United States as well.

OTC-desk

Let’s say that you hold a very large amount of a certain cryptocurrency. You want to sell that amount. Should you do that on a regular trading platform like everyone else? Maybe not. One of many reasons for executing large trades outside of the normal marketplace is that large trades may affect the market price of the relevant crypto. Another reason, which is connected to the foregoing, is that the order book might be too thin to execute the relevant trade. A solution to these problems is what we call OTC-trading (Over The Counter).

FTX offers OTC trading, which might be helpful to all the “whales” out there (and maybe also to all the “dolphins”).

Leveraged Trading

FTX also offers leveraged trading to its users. However, to our understanding, the maximum leverage level is 3x (i.e. three times the relevant amount). There are many exchanges out there where you can have 100x or even more as your leverage level.

A word of caution might be useful for someone contemplating leveraged trading. Leveraged trading can lead to massive returns but – on the contrary – also to equally massive losses.

For instance, let’s say that you have 10,000 USD on your trading account and bet 100 USD on BTC going long (i.e., increasing in value). You do so with 100x leverage. If BTC then increases in value by 10%, if you had only bet 100 USD, you would have earned 10 USD if you simply held Bitcoin. Now, as you bet 100 USD with 100x leverage, you have instead earned an additional 1,000 USD (990 USD more than if you had not leveraged your deal). On the other hand, if BTC decreases in value with 10%, you have lost 1,000 USD (990 USD more than if you had not leveraged your deal). So, as you might imagine, there is potential for huge upside but also for huge downside…

Who Can Sign Up Here?

New users can sign up from almost anywhere in the world. However, investors from the United States and a few other countries are not able to sign up as of now. 

FTX does not accept new users who reside in the following territories: 

• The United States
• Cuba
• Crimea and Sevastopol
• Iran
• Afghanistan
• Syria
• North Korea

It should be noted here though that FTX has a US branch (FTX.us) that accepts US investors, but not from all states. Residents from New York State, for instance, are not permitted to trade there either.

Why do so many exchanges not allow US citizens to open accounts with them? The answer has only three letters. S, E and C (the Securities Exchange Commission). The reason the SEC is so scary is because the US does not allow foreign companies to solicit US investors unless those foreign companies are also registered in the US (with the SEC). If foreign companies solicit US investors anyway, the SEC can sue them. There are many examples of when the SEC has sued crypto exchanges, one of which being when they sued EtherDelta for operating an unregistered exchange. Another example was when they sued Bitfinex and claimed that the stablecoin Tether (USDT) was misleading investors. It is very likely that more cases will follow.

FTX does not allow US investors on its exchange. So if you’re from the US and would like to engage in crypto trading, you will have to look elsewhere. Luckily for you, if you go to the Exchange List and use our Exchange Filters, you can sort the exchanges based on whether or not they accept US investors.

NFT Support

FTX has great NFT, or non-fungible token, support. You can buy and sell NFTs on their in-house marketplace. You can even mint your own NFTs on FTX and sell them. Plus, if you stake enough FTT, you are eligible for free NFT drops, which you can then resell on the marketplace. 

Can I trust this site?

FTX is a well-known and trusted brand. It is one of the world’s largest crypto exchanges and has high liquidity. It is one of the most trusted and secure crypto exchanges around. 

Here are some of its safety features

• Requires two-factor authentication 
• Withdrawals can be protected by a specific withdrawal password, or by only allowing withdrawals to a whitelist of wallets
• You can whitelist IP addresses, so only certain IP addresses can access your account
• Hot and cold wallet functions
• Full external backing of funds in hot wallets

A Convenient Mobile App 

FTX also has an app that you can download from the Google Play Store or the Apple Store. The app currently has a 4.8/5 star rating in the Apple Store.

Who Should Sign Up?

FTX is a great exchange. New users can feel safe here engaging in spot trading, and advanced investors can engage in derivative trading, the NFT marketplace and more.