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Doing Business on Giant.Exchange

15-08-2018

There are many ways to earn money on classic assets and currency market these days: usual market trading has become much easier with the arrival of computers. Instead of direct securities and currencies trading, people can use various derivatives - for example, futures and options.


Although many consider it revolutionary, the market of cryptocurrencies is now acting on practically the same principles: both direct digital assets trading and derivatives already exist (for instance, CME and CBOE Bitcoin futures, lately there has been an active discussion on the opportunities of Bitcoin ETFs). Despite this, the market of cryptocurrency repeats not only the good ideas, but the disadvantages of the fiat market as well: many know about the fiat ‘forex kitchens’ where the wins of traders equals loss for brokers. A similar situation can be seen on the market of binary options - brokers manipulate assets and data because they are driven solely by their own interests. More on the types of binary options and how they work can be read in our article called What is Giant.Exchange.

Let’s review the binary options market size. According to LeapRate, in 2015, 336 thousand of active binary options-related accounts existed in Japan alone. In the following years, the interest of the public towards this topic has risen which is evidenced by 110 thousand search requests every month in 2016. This is comparable to ‘forex trading’ request stats. Quite probably, the interest growth trend will continue in the near future.

Binary options are negatively characterized by the regulators of several states due to the fact that brokers, as already mentioned above, are acting out of their own interests and want clients to lose more money. The unregulated market becomes twice unregulated if binary options are connected with cryptocurrency. Giant.Exchange is designed to provide traders a safe way of engagement with binary options without fearing to become a victim of brokers’ manipulations.


You Can Tell The Truth About Assets And Get Paid


But acting as a trader who earn on forecasts without any manipulations coming from the exchange owners is not the only way to make money on Giant.Exchange. For 1000 GIC (our cryptocurrency Giant Coin) you can become an owner of the masternode - a managing hub of Giant blockchain network with extensive powers. Apart from the revenue generated for every new block of the blockchain which will pay off the initial investment just in several months, the masternode manager will have an opportunity to create new Oracle’ and/or ‘Binary Option’ smart contracts.


‘Oracle’ smart contracts provide data on the subject of binary option from an external trustworthy source. It can be the API of a cryptocurrency exchange or of a price aggregator. One of the oldest problems of binary options is efficiently solved — finally, users can find out where brokers get the numbers from and bet on the future crypto and other assets behavior accordingly. In Giant documents, ‘Oracle’ smart contracts creators are sometimes simply called oracles. It is important to note that they do not predict the future - they tell about the asset status in the past and the present.

And what if several oracles are grabbing data from the same source and post very similar smart contracts? The determining factor for a broker or a binary options creator would be the smart contract service fee together with the displayed reputation of the oracle. The reputation system solves another binary options market problem of shady brokers.

Thus we have reviewed two Giant.Exchange member categories which are not traders and despite this, do not remain in the shadows. Both oracles and brokers are going to find beneficial to post as much verifiable market experience history as they can and work towards gaining a better reputation. The better the smart contracts made by the oracle are, the more ‘Binary option’ contracts are created on their basis. This, in turn, raises the passive income. 

Let’s check out the engagement of oracles with brokers step by step:

  1. The masternode owner creates an ‘Oracle’ smart contract.
  2. After voting, this smart contract is published in the list of all offerings for brokers.
  3. The broker chooses the ‘Oracle’ smart contract which is most useful for the future binary option. If the data and the sources match, the broker is guided by the reputation of the oracle and how much fee he demands.
  4. The broker would find beneficial to choose an oracle with a good reputation so that the binary option was interesting for the users and its data reliability wasn’t questioned. This creates a healthy competition between the oracles.

At the end of the day, the situation looks as follows. Brokers use independent data sources and they have a choice of existing ‘Oracle’ smart contracts, whilst oracles can get a lot of money just because the contracts they created are often used by brokers.

What Makes You a Good Broker?

Instead of providing data for brokers you can become a broker yourself. In order to do so, the masternode ownership is also required but to create smart contract which underlie all binary options on Giant.Exchange. The eponymous ‘Binary option’ smart contract is inseparable with the aforedescribed ‘Oracle’ smart contract, this is why you should pick a correct data source for a certain task. Giant.Exchange recommends brokers to see things from the point of trader’s view during the creation of new binary options and imagine how traders are going to receive your binary options and the fee for it use.

It is clear that binary options with unrealistic scenarios will not cause a wave of trader interest. Nobody will bet their money on the price dynamics with little to no probability. This means that brokers must separate realistic scenarios from fantastical ones. However, binary options dedicated to scenarios which will almost certainly happen are also of little interest to anyone.  

On our platform, brokers should bother with all this because their binary options are directly affecting their reputation and their subsequent financial status. Interesting binary options are attracting traders and go in full accordance with the deadlines set in advance instead of remaining pending for months. More successful binary options equals more positive reputation and thereby more money. 

When creating a ‘Binary option’ smart contract, brokers may choose from two variants. In one of them, the broker risks with own finance and plays against traders, while in another type of smart contract, traders only play against other traders. In the latter case, the broker’s revenue is only the binary option participation fee.

To get a good reputation and demand, every broker should realistically assess ‘Oracle’ smart contracts and their sources, while also knowing the market so much that new binary options on assets behavior scenarios were interesting for traders, as the binary option bank depends directly on their quantity. Contrariwise, unpopular binary options will not be of any use for brokers.

Our cryptocurrency Giant Coin (GIC) which is necessary for all three key parties of Giant.Exchange has recently been included in the lists of what is probably the most popular and respected crypto prices aggregator — Coinmarketcap. Now you can follow the price dynamics of our asset on this user-friendly website. The Giant Coin demand will grow thanks to the rise of popularity among traders and to the competition of brokers and oracles. The growing public awareness about Giant.Exchange will also accelerate the demand for mastenodes, which, as we mentioned before, are purchased for GIC.

This aside, the White Paper of the project describes several additional ways to make money with Giant: PR support and the creation of unique smart contracts. In the future, we may implement a marketplace for such offerings.

Summary

  1. Giant.Exchange solves all old problems of binary options: conditions created for brokers, oracles and traders prevent virtually all manipulations.
  2. Instead of one questionable info source, traders get a wide choice of binary options where the data provider is explicitly stated and easy-checked.
  3. Brokers, in turn, are interested in the reputation strengthening and creating a high binary options trade volume - to reach this, contracts must be transparent and profitable.
  4. Oracles or information providers can tell the market about which price aggregators or exchanges deserve attention, and the subsequent use of their contracts will show if they are right. Just like brokers, oracles are interested in not making the smart contracts usage fee too high.
  5. The Giant Coin digital asset gets additional liquidity. Masternodes are acquired for GIC, the oracle and broker commissions are also charged in this cryptocurrency. Giant.Exchange is only the first decentralized app (DApp) which widely uses  GIC and backs the demand for this cryptocurrency.

Conclusion

The system of Giant.Exchange motivates all binary options creation process participants to have the interests of other parties in mind instead of making money on the financial losses of others. Furthermore, the wide smart contracts application opens up new opportunities of practice for fintech architects, especially if a smart contract dedicated to completely new assets is created. Assets aside, Giant.Exchange is also reviewing the possibility to create binary options about the market capitalization dynamics and the overall cryptocurrency market trading volume.

Reference

  1. Bloomberg,  Bitcoin ETF Faces Moving Finish Line as Cboe Aims to Be First.
  2. Giant, What Is Giant.Exchange.
  3. LeapRate, The History of Binary Options Trading – Infographic.
  4. The United States Securities and Exchange Commission, Binary Options Fraud.
  5. Giant, Giant Contracts White Paper.
  6. Giant, Latest Sprint News: Team, Bounty, Testing and Our Biggest Achievement.
  7. Giant, Giant White Paper

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