This article provides a comprehensive explanation and tutorial on Storm Trade, the first decentralized derivatives exchange in the TON ecosystem, which has derived low-risk arbitrage strategies from its higher funding rates.
Table of Contents:
1. Storm’s funding rates are several times higher than those of general CEX.
2. Storm trades earn airdrop points.
3. What are the risks of Storm Trade?
Introduction to the first decentralized derivatives exchange in the TON ecosystem
Storm Trade aims to allow users to leverage trade cryptocurrencies, stocks, forex, and commodities on the web and Telegram. However, currently, it only has around ten trading pairs.
In simple terms, Storm Trade provides a decentralized perpetual contract exchange in the TON ecosystem. The following article by Breaking.TON introduces the current low-risk arbitrage strategies of Storm Trade.
Storm Trade is a derivatives exchange in the TON ecosystem, similar to dydx. Although it currently has a limited number of token pairs available for trading, its funding rates are mostly several times higher than those of general exchanges, creating arbitrage opportunities!
Using the BTC/USD contract as an example:
The funding rate per hour is +0.01695% (longs pay shorts).
The holding commission per hour is 0.0034% (platform-specific fee).
Bybit’s current funding rate is +0.0004% every 8 hours (longs pay shorts).
Therefore, if you short on Storm and long on a centralized exchange (or buy spot without leverage to save funding costs), the daily funding rate earned would be: (0.0169% – 0.0034%)*24 – 0.0004%*3 = 0.3228%.
In other words, the annualized return rate is approximately 117% APY (excluding the platform’s trading fees).
Note: With the current BTC price at $66,000, the funding rate per hour is generally between 0.01% to 0.017%, unless there is significant volatility. If leverage is applied, the potential return rate is even higher.
Additionally, the platform is currently conducting an airdrop points activity. By trading or providing liquidity, users can accumulate points, which can be used to apply for token airdrops (scheduled for Q2 this year). For detailed information on point accumulation, please refer to this link: [URL]
What are the risks?
The biggest risk is the possibility of the platform running away or the oracle being hacked, leading to abnormal coin prices. Please be aware of your risk tolerance.
Furthermore, there may be slight discrepancies in prices between Storm and other CEX. However, based on my testing, they generally oscillate synchronously. There might be some minor friction when closing positions. Do Your Own Research (DYOR).
Reminder from the author: As the project is still in its early stages, please ensure proper risk management.
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