Startup Crypto Exchange Blade to Launch Zero-Fee Trading in February
The Coinbase-backed exchange, which began operations in September, also will drop the $10 subscription fee it had planned to gather from traders on a monthly basis. Though based in San Francisco , Blade prohibits U.S. residents from opening accounts on its platform.
Blade are going to be the primary cryptocurrency exchange to supply fee-less trading in bitcoin perpetuals - no-expiry contracts which mimic a margin-based commodity exchange and trade on the brink of the underlying reference price.
Its main rival, BitMEX, which dominates the perpetuals space, is currently charging a 7.5 basis points (bps) taker fee per trade then are other competitors, namely Deribit and ByBit.
Further, there'll be no restrictions or eligibility requirements. this is often in contrast to a couple of exchanges that provide products somewhat almost like zero-fee trading, but require users to shop for and hold exchange tokens.
With a fee-less, zero-eligibility model, Blade is hoping to draw in meaningful volume from the likes of BitMEX and other exchanges. Blade also offers up to 150x leverage, compared to BitMEX’s 100x leverage.
The increased volume could come from high-frequency trades like scalpers, who enter and exit quickly, usually within seconds, using high leverage to form many small profits from large numbers of trades throughout the trading day. Scalpers work on thin margins and wish lower costs to form money.
If Blade succeeds in capturing a big market share with its new strategy, it could trigger a pricing war, where rivals reduce costs to retain users.