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Tuesday, December 1, 2020

A new decentralized exchange lets users trade commodity and crypto derivatives

Fetch.ai is launching Mettalex, a decentralized exchange that allows its users to trade commodity and crypto derivatives. The users will be able to gain exposure to old-fashioned crypto trading pairs in addition to commodities like gold, silver, cobalt, oil, and even the stock exchange indices.

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Humayun Sheikh, who serves as CEO to both projects, told Cointelegraph that in addition to providing exposure to new investment services and products for the crypto community, it gifts three main competitive benefits to commodity traders:

“One very key advantage for them is that they can build the market and they can bring the market to people. So second, of course, the costs are much lower. […] And really the third benefit is the way you can actually operate these instruments. For them to have these instruments, they will have to hedge their risk in two or three different places. What this enables them to do is just bring it into one instrument so the margin costs are low.”

Sheikh said that the expenses are kept down by utilizing Fetch as a sidechain. He also stated that Mettalex has recently secured commitments from around 30 commodities traders:

“I think it’s around 30 traders at the moment who are initially going to be jumping. And these each trader is probably trading in the region of around one hundred million a year.”

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According to the CEO, the requirement for posting a collator in cryptocurrency should not present a real challenge to the users who come from the original world. He believes that numerous are more comfortable with crypto and that the company will give you an easy to use interface.

Those who’ll be creating markets on Mettalex will need to provide collateral in the form of stablecoins, which will be changed into the indigenous token MTLX. Since the project will probably be decentralized, the token will soon be used for both liquidity pools and governance.

The already heated DeFi space gets a new and unique playground with Mettalex.

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