FTX Review 2022: Features, Comparisons, Pros & Cons
Access to computing and the internet has improved how we interact with others and how things are executed. This interaction cuts across every sector, and finance and investment aren't left out of the game.
How we buy, sell, and trade items are executed on digital platforms. Now, our money is digital and can be traded on digital platforms, including exchanges where people trade their currencies for profit.
FTX is one of the most remarkable and popular exchanges to buy, sell and trade digital currency (also referred to as cryptocurrency). FTX is a global crypto exchange with a wide range of trading options available to its users.
FTX offers services relating to volatility, leveraged tokens, prediction markets, staking, spot trading, and futures.
This review will explore everything you need to know about FTX, its features, its pros & cons, and how it compares to similar cryptocurrency exchange projects in its ecosystem.
What is FTX?
FTX is a centralized digital cryptocurrency and crypto derivatives exchange that has established itself in the crypto trading market.
In finance, a derivative is an agreement between two or more people that derives value when assets linked to it perform. In cryptocurrency, derivatives derive value from other digital currencies.
By some, FTX is referred to as “the trading platform built by traders for traders.” FTX is intuitive and easy to use by first-time users and has advanced trading capabilities for professional traders.
FXT Background and Summary
FTX is a derivative exchange based in the Bahamas which became operational in 2019. It was founded in 2018 by Sam Bankman-Fried—an ex trader at Jane Street Capital—and Gary Wang—a former software engineer at Google.
FTX is an innovative trading marketplace for both beginners and professional traders alike. It is equipped with a wide range of market options and an intuitive mobile application.
How to Register an Account on FTX
To access the various services offered by the FTX trading platform, you will need to create an account with FTX.
Creating an account on FTX is quite simple, as the sign-up process is similar to other cryptocurrency exchanges.
FTX account creation step-by-step:
- Go to the FTX website
- Once on the FTX website, click on “Register.” If you were referred to FTX by a friend, enter their referral code to get a 5% discount on trading fees
- Next, enter your email and choose a password. Your password must contain upper and lower-case letters, numbers, and special symbols. A minimum of 12 characters is recommended to give your password a reasonable strength.
- Review the FTX terms of service and tick the box to confirm that you have read and agree to its terms of service. Then click the “Verify”
- Next, set up your two-factor authentication on the “Secure Your Account with 2FA” You can use the Google Authenticator tool, FIDO, U2F, Yubikey provided
- Click on Google Authenticator and scan the QR code, and your two-factor authentication will be saved on the app. Install the Google Authenticator application if you don't have it installed on your mobile device
- Finally, enter your two-factor authentication from your mobile device onto the FTX platform. Enter for each log on and verify
- You can now deposit money and trade with a withdrawal limit set at $1,000 until you complete the know your customer (KYC) verification.
FTX Know Your Customer Requirements Per Tier
After your two-factor authentication, go to the “settings” page to finish your KYC verification process and unlock higher tiers.
- Tier 1: You will be required to fill in your full name, country of residence, province, or region. At this tier, your account is limited to $2,000 daily withdrawals.
- Tier 2: This tier identity verification form requires your proof of identity and proof of address documents. Withdrawal is unlimited but must be in cryptocurrency.
- Tier 3: You need to fill out the form and upload a recent statement from your bank for fiat transfers. Withdrawal is unlimited and supports cryptocurrency and fiat.
Tier 2 and tier 3 account holders that have completed their KYC verification have unlimited access to transfer cryptocurrency directly as fiat using a wire transfer to a bank account. Or they can withdraw their digital currency into a hardware wallet such as LedgerX.
Also, FTX accounts that have completed the AMC/KYC process are allowed to use the OTC desk service. The OTC service allows traders to buy large amounts of a particular crypto asset.
How does FTX Work?
FTX is a centralized exchange with a web platform and mobile application where users can trade cryptocurrency.
FTX is available to users outside the United States and includes a wide range of coins and features (e.g., derivative trading) compared to the FTX.US platform for residents in the United States. FTX.US is a more basic platform that is available to users in the United States except for New York.
After signing up and verifying your identity on your FTX account, you can wire transfer or deposit money to buy cryptocurrencies available on the FTX platform.
Users can also grow their crypto through staking to earn up to 8%. FTX makes a profit and stays operational as a crypto exchange by trading with crypto coins and tokens.
Deposit Methods on FTX
Users can deposit assets in different ways: through wire transfers, depositing existing cryptocurrency, debit, and credit cards.
Features of FTX
Below are relevant features that can be found on the FTX platform. These features give first-time users and professional traders personalized experiences. However, this isn't an exhaustive list.
This page contains your withdrawals, balance, fiat option, convert option, and deposits.
To find a coin, click the “Search” bar and enter the asset you want to find.
In the balance section, you'll find Balance and Available Balance for your specific coins. Balance is how much you own, and your available balance is the amount you own and aren't using for open orders.
Click “Hide Zero Balance” to filter the coins that you own.
To deposit or withdraw a cryptocurrency, click “Deposit” and choose the address receiving your cryptocurrency. And click “Withdraw” to withdraw. At the bottom of the wallet page, you will find your pending withdrawals and deposit.
FTX supports a fee-free system for deposits and withdrawals.
Converting your cryptocurrency, say BTC to USDT, is as simple as clicking a button. To convert, click the “Convert” button and enter the quantity From coin and enter the quantity To coin. Confirm the price shown and click on “Convert.”
Fees are not attached to cryptocurrency conversion on FTX.
FTX supports wire transfers. Wire transfers up to $1,000,000 and above can be performed with no charge attached. But the withdrawal of fiat currencies on FTX is accessible to level 2 account holders and above.
That is, you must complete your level 2 KYC verification to deposit and withdraw fiat currencies. To see your available currencies, click on “Fiat” on the wallet page.
FTX offers several products to its users. To explore the different products and services on FTX, click on the different tabs on the market page.
You can add a market to your favorite by clicking on the “Star Icon.” By clicking the star at the top, you will find the list of your favorite markets.
To trade a product, go to the trade for that product and trade.
You can customize the interface to suit your needs. Customization can be in the form of building your own layout and tracking your coins directly. Choose the configuration you have the best experience using.
Account and Security
This page contains your API keys, security, referrals, and fees. You can access the account security and KYC by clicking the top right corner.
FTX Token: FTT
FTT is the native token of the FTX project. Investors consider FTX tokens profitable; hence, they buy and sell. Users that hold FTT on FTX receive lower trading fees.
As of the time of writing, the last price of FTT is around $40.96, with a market cap of over $10,000,000,000. The total supply of the token is 333,688,070 FTT, with a circulating supply of 259,369,371 FTT. FTX token is reliable and offers scalability.
FTX is working towards reducing the gaps in the crypto trading market. The exchange offers different trading products, including leveraged tokens, prediction markets, MOVE contracts, options trading, and futures.
FTX account holders can trade futures trading of over 20 assets and 45 leveraged tokens.
Leveraged tokens are ERC20 tokens that give users exposure to leverage the cryptocurrency market.
Only trade leverage tokens if you understand how it works. The gains and losses on the value of leveraged tokens can be large in amount. Hence, it is considered to be a very high-risk product.
Like every ERC20 token, leveraged tokens can be withdrawn. Also, they can be transferred to other exchange platforms, like Bitmax, that list the tokens.
You can buy a leveraged token on its spot market or directly use the “Convert” option on your wallet page. Trading perpetual futures on FTX results in leveraged token price performance.
An option is a contract that gives an investor the right to buy and sell an asset on a specific date and at a specific price.
Go to ftx.com/options to trade options. After developing the option you like, click “Request Quote,” and in seconds, an offer will appear for the option you developed. If satisfied with the price, click “Accept” to trade, or you can choose not to trade if you don't like to trade at that price.
The FTX exchange has a quarterly future that expires and a perpetual future on many coins, including ETH, USDT, and BTC.
Pros and Cons of FTX
- Customizable user interface
- Wide selection of trading products
- Ability to stake with the FTX token—FTT
- Low trading fees
- Solid customer support
- Trading leveraged tokens are risky
- Unavailable to residents of the United States
- Complex trading options
FTX Compared to Other Cryptocurrency Exchange
FTX has similar features to Bitfinex, Coinbase, and Binance. However, there are significant differences that can be seen between the various platforms.
FTX vs. Binance
- FTX trading fees are relatively low compared to Binance's trading fees
- In 2021, Binance added a live chat feature to its service system, but this option is unavailable on the FTX platform
FTX vs. Coinbase
- FTX fee structure is lower than the regular Coinbase and Coinbase Pro platforms.
- FTX has a wider range of assets than coinbase. FTX has over 300 cryptocurrencies, with Coinbase having over 90 cryptocurrencies.
- Based on your level of experience in cryptocurrency investing, Coinbase is more beginner-friendly than FTX.
Frequently Asked Questions
Is FTX a Good Crypto Exchange?
FTX performs better than most crypto exchanges in the market. The exchange offers a wide range of assets and has low trading fees.
Can I Automate My Trading on FTX?
Yes. FTX has an automation protocol called Quant Zone that lets you customize and automate your trading using their APIs
Is FTX Exchange Safe?
Malicious attacks and hacks have been managed by the exchange since it began operational in 2019. There has been no bridge in its security to date.
The FTX team has made security a priority. This is noticeable in security standards, the use of full SSL encryption on the website, and the two-factor authentication to help secure the accounts of users.
Is FTX regulated?
Currently, FTX is not regulated, and users in the United States are not allowed to use the exchange. A separate entity—FTX.US—was developed for customers in the United States, and it's regulated.