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[Q&A] Zhang Jian’s Comprehensive Interpretation about the first appearance of FMe...

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2019-6-7 23:53
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本帖最后由 Miranda 于 2019-6-14 11:43 编辑

Title: Zhang Jian’sComprehensive Interpretation about the first appearance of FMex Contract Exchange, 13 Questions & Answers

Text:
FMex, the contract trading platform of FT Ecology, held its first online conference at21:00 on June 5th. Zhang Jian, the founder of FCoin, answered the questions about contract business, income distribution, community governance and sustainable mining mechanism of FMex platform.

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ZhangJian said that FMex is a long-awaited strategic product of the FCoindevelopment team. It’s basic advantage is to build a contract exchange that truly belongs to the trader. The FMEX holder is the only equity owner of FMexbesides 80% of the revenue distribution and true community governance rights. In addition, FMex has four features-- top technology, 80% revenue distribution, community governance, and sustainable mining mechanisms, among the last three ofwhich, are unique to FMex.

Talking about the relationship between FMEX, FCoin and FT ecology, Zhang Jian said thatFMEX and FCoin are parallel relationships and both are parts of the FT ecosystem. FMEX will be issued based on the FT public chain. The development of contract exchanges and the FT public chain will promote each other in the future. Both of them aim to build a “future financial and economic infrastructure” to jointly promote the development of the entire industry.

The core views are as follows:
1.The communilization and Token economy advocated by FCoin is the development direction of the entire Block chain industry and even the future finance and economy and can be used in the FMex contract trading platform.
2.FMex is not a private company. There is no traditional shareholder. FMEXholders not only enjoy 80% of the income distribution but also have real community governance rights.
3.The most important ability of the contract exchange is to control the risk and maintain the fairness of the trading. FMex is designed to use the full-memory model to ensure constantly response and liquidation of each user's effective orders.
4.FMex has used the daily settlement system since its inception (which is consistent with traditional futures). The biggest advantage of daily settlements that it allows users to take profits after settlement immediately.
5.FMex has three layers of risk control measures: forced liquidation, contract insurance funds, and automatic underweight.
6. Sustainable mining is one of FMex's core advantages. Compared with the early Fcoin mining, the biggest difference is the fixed release amount and 1-year lockup terms, which avoids the short-term econnoisseur the best we could and guarantee the return to the traders.

The following is the full content of the conference of Q&A:
Q1: What is the consideration for the launch of the FMex contract trading platform? What do you think of the market environment of Exchanges for this year?
A1: The contract trading platform is a strategic product that the FCoin development team has been preparing for a long time. We believe that the development of the digital asset derivatives market is a very important part of the development of the entire industry. The community and Token economy advocate can still have an impact on the contract trading platform.
I firmly believe that the community and the token economy are the development direction of the entire blockchain industry and even the future finance and economy. In this context, we launched FMex.
My view on the market environment of exchange for this year is that not only this year but also the next two years, the market environment for digital asset exchange is still in an early and immature state.
Early and immature can be understood from two aspects: on the one hand, the whole market is very immature in terms of technology, products, rules, etc., with various problems to be solved or perfected; on the other hand, this market still has great potential. Basically, it is still in the stage of barbaric growth, and there are still very good opportunities.

Q2: For the contract business, what is the difference and advantage of the contract business compare with the exchanges with contract business on the market already?
A2: Regarding the advantages, I can summarize here: one basic advantage + four features.

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one basic advantage, which is also our goal and initial intention: to create a contract exchange that truly belongs to the trader, that is, the trader's own contract exchange.
As we all know, the exchanges currently on the market are company-owned with a small number of private shareholders. Contract exchanges are very profitable, but they have nothing to do with normal traders. It is difficult for traders of the platform to share the development and income of the exchange, and there isno substantive speaking right.

FMEX is not a private company and there are non- traditional shareholders. The FMEX Token holder is the only owner of FMEX, not only enjoy 80% of the income distribution but also real community governance rights. This is our most fundamental difference.
The four features are top technology architecture, 80%revenue distribution, community governance, and sustainable mining mechanisms. The last three points are the unique advantages of FMEX (that’s what the existing contract exchanges don't have). It is also the result of the FCoin platform accumulated practice within one year. I won't go into the details.
Let me talk a little bit more about the technical advantages here: the most important ability of the contract exchange is to control risk and maintain the fairness of the trading. BitMEX is a relatively good contract exchange on the market today. But BitMEX’s technical structure was built 3 years ago, which already shows users with larger scales cannot be supported, and system bottleneck also appears during market fluctuations are severe.
FMex started with a full-memory model to ensure real-time response and liquidation of each user’s valid orders, especially during forced closing and automatic underweight, they can be processed at the same timing as the order response and matching processing.This is the embodiment of the “top technology” that we mentioned.
In terms of top technology, it is worth mentioning that our settlement advantage:Since digital currency trading is 7×24 continuous, and early bitcoin price fluctuations are fierce, FMEX has used the daily settlement system since its inception (which is consistent with traditional futures). The biggest advantage of daily settlement is that it allows users to take profit after settlement immediately.
Some domestic exchange contract systems have designed a mandatory apportion system,and the user's profit can only be determined after the weekly settlement is made and no loss for system. BitMEX's fixed-term contract must also wait until the due date after paying off the profit.If users want to withdraw the profit midway, closeout must be operated manually.

Q3: How to solve the risk control and trading security? How to control if there is an extreme market? is there an apportion mechanism for wiping out?
A3:The mandatory liquidation, contract insurance fund and automatic underweight mechanism we adopted are the more effective and fairer risk control measures for contract exchanges in the industry.
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The biggest problem with the apportion mechanism is that the contract exchanges force the uncontrolled loss risk to profitable users, which reduces the actual profit of the profitable users. So, there is no apportion mechanism on FMEX.
Lets briefly introduce the forced liquidation, contract insurance fund and automatic underweight mechanism that we use:
Forced liquidation is the first layer of risk control for contract exchanges, which is what we often call a wiping out mechanism.
The contract insurance fund is the second layer risk control method of the contract exchange.The insurance fund is used to prevent automatic underweight, and to improve the price of the unexecuted forced liquidation to avoid being taken over by the automatic underweight system. FMEX will introduce a certain amount of insurance funds at the beginning of the system's launch. The increase of the funds comes from the forced closing orders at a better market price than the bankrupt prices.
Automatic underweight is the third layer of risk control for contract exchanges.Automatic underweight occurs when the contract insurance fund cannot cover the risk of forced liquidation. Automatic underweight is to ensure the real profit of high-risk users in an extreme market, to prevent the profits loss with the volatility of the market, and to help reduce the risk of losing users.


Q4: Why there an isratio setting for FMEX: “35% belong to FT community, 35% use for mining, and the rest 30% used for raising funds”?
A4:First of all, FMex is a community-based exchange, that technically supported by FCoin platform. It is an important part of the FT ecosystem.  so, it is very reasonable for the FT community to hold 35% FMEX.

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Secondly,35% of FMEX belongs to the FMEX community which will used for sustainable mining. This is the practice of communization and token economy, and also the initial insistence of “making traders the real owners of trading platforms”.
Finally,the rest 30% of FMEX is used to raise funds. This is because of the competition between the contract trading platform is now very fierce, we need sufficient development funds to participate in the market competition and take the lead in the competition.
This arrangement not only allows FT holders to enjoy the value of ecological expansion but also fully release the potential of communization and token economy and allows the platform itself to have sufficient development momentum to participate in market competition., As you can see, there is no reservation for any team or early private sales, etc. which is considered as a selfless arrangement.

Q5: How is the design of FMEX user fee like? How do you allocate the interests from sustainable mining and fee refunds?
A5: FMex and FCoin spot trading are consistent in the design of the fee charging. We encourage Merchant and market makers, which means takers pay the handling fee while makers earn fee. At the same time, FMexhas various order types and a target profit &stop-loss mechanism.
Sustainable mining is one of FMEX's core strengths and the achievement of FCoin after a year’s practice. The essence of “mining” is the long-term reward behavior that gradually gives the ownership of the platform to the trader. the biggest difference between sustainable mining and early FCoin mining is the fixed release amount and 1-year lockup terms, which avoids the short-term econnoisseur the best we could and practice our initial intention of “making traders be the owners of trading platforms”. All FMEXreturned from sustainable mining will be locked for 1 year to avoid the short-term econnoisseur the best we could so that the platform's token can be returned to the trader.
Q6: On last Friday,FCoin published an announcement on the issuance of FMEX platform token. The quote of FMEX was all sold out in seconds at the last three consecutive days from this Monday. Have you expected this situation? What is the reason?

A6: I think there are two main reasons. The first is the charm of the FCoin platform itself. The second is that everyone thinks high of FMex.
First of all, we know that FCoin just had its first anniversary. After years of accumulation and development, FCoin has become a banner in the implementation of communalization and practice of the Token Economy among the trading platforms.It has a very high-quality, loyal user base. This user group is also a staunch supporter of the FT ecosystem.
The second reason is user’s expectation of FMex. As you can see, the position and importance of contract trading in the entire market have gradually increased in the past two years. In particular, the rise of the perpetual contract represented by BitMEX has been changing the pattern of the entire trading market.
In addition, the profit space of the contract exchange also gives everyone greater expectations and confidence. The particularity of the contract trading platform(such as high leverage and high pressure of risk control) leads to very high requirements for the underlying technology, which makes it difficult for small and medium-sized exchanges to join the competition in this market.
The underlying technology itself is an advantage of the FCoin development team. As we all know, last year, FCoin had already carried the world's largest trading volume in just one week and keeps the trading fluency ever since, serve down never appear on FCoin.
Furthermoreinaddition to the top level in technology, FMex also has the advantages of communalization, especially the introduction of sustainable mining mechanism, which makes the market full of expectations.
The second reason can also be simply understood that FMex will have similar early start-up advantages as FCoin in the contract trading market while avoiding flaws in its early mechanisms, which will make FMex's development healthier, more sustainable and more motivated.

Q7:This public issuance of FMEX is understood as “Super IEO” by some people. Do you recognize this statement? Can you elaborate on the process and design intention of this public issuance?
A7:This fundraising is based ondaily subscription + targeted allotment with a total of 300 million FMEXto be purchased, of which each of the two methods accounts for half of thequota. This design is aimed to balancethe fairness of the market and the interests of FT holders.
The daily subscription is mainly to ensure the fairness of the market. Everyone can subscript the FMEX at the beginning of the daily subscription until all been sold out with no additional condition.The targeted allotment is mainly for the consideration of FT holders’ interest.The specific method is allowing over-purchase first, allocate the allotment needs based on FT Lockup proportion in priority order, and then the purchased capital proportion.
The daily quota is 10 million for both daily subscription and targeted allotment, this design is to make the fundraising fairer. If it is completed once or twice, it is very likely that there will be many people who do not know or are not ready while it’s over. Properly having a fundraising period will give everyone the opportunity to participate.
I think the super IEO statement is a bit exaggerated. The fundraising of FMEX is somewhat similar to IEO, while somewhat different.The similarity is that they are all fundraising activities led by the exchange.The difference is that FMEX is not a third-party project, it is part of the FT ecosystem with FCoin. The FT community is the largest holder of FMEX.

Q8: You mentioned during FT community sharing that the FMex business is “typical ecological expansion, not platform expansion”. How to understand it?
A8: The platform expansion here refers to adding new functions to the sameplatform, while the expansion of ecology refers to the establishing platformbut belongs to the same ecosystem. Why we didn’t choose platform expansion insteadof ecological expansion for the contract business? I had explained before inthe community, here is a brief explanation: the first reason is that the usergroup is not completely consistent with very obvious differentiation.

We all know that spot trading suits universal platforms. In theory, it can be understood that where the cryptocurrency circle expands, there the spot platform expands. It almost has no boundaries in the industry. However, the contract exchange is a high-risk platform, and the participating population is much lower than spot.
There will be big problems if we completely integrate them into one platform. Because everyone knows that we are a community with community governance and dividends if the two users form these platforms are very different, there will be a lot of difficulties in community governance: different positioning, different people.
The second reason is that we need to have sufficient motivation. First of all, the competition between different contract trading platforms is now fierce, so we need to have sufficient development funds to participate in market competition.In addition, we also need sufficient sustainable mining space to provide incentives.
If the two platforms are integrated, we must assign part of the sustainable mining from the spot trading platform to the contract platform. In addition to the different user groups mentioned earlier, this will result in unreasonable, irreconcilable internal difficulties which can affect both businesses.

Q9: What is the relationship between FMex, FCoin and FT Ecology? What is the relationship between contract trading and the “future financial and economic infrastructure” that the future FT public chain points to?
A9: FMex and FCoinare parallel relationships which both of them belong to an important part ofthe FT ecosystem. The FMex contract exchange is an importantpart of the FT ecosystem, and its Token FMEX will be issued based on the FTpublic chain. FT public chain has committed to the construction of the"future financial and economic infrastructure", the various assets issued on it naturally have financial attributes, both the demand for spot trading and the broader market for derivatives trading. The development of future contract exchanges and the FT public chain will promote each other and aim to build a “future financial and economic infrastructure” to jointly promote the development of the entire industry.


Q10: A lot of moves made by FT Eco recently which including public chain, FFUND, FI, FJ andFOne, which has always been the focus of attention. How does the team support so many businesses?
A10:FMex and FCoin are parallel relationships and are important parts of the FT ecosystem. The FT public chain has an independent team and has been the core of the FT ecosystem. As for FFUND, the fund manager is the FT community, the managing partner is the consensus lab which is also an independent team. The FI project is under regrouping now and will be part of the FT ecosystem once completed. A professional and independent team is being formed. FJ is the first attempt of FT ecological internationalization. After completion of the depth-sharing,FT Eco will also promote the community-based governance of FCoinJP to the right track and complete local expansion.
FOne's dismerge is still in progress,and it will be a community-based and “merchants’ autonomy “exchange with merchants at its core. The FCoin platform still provides technical support.
In summary, we can see that these are not completed by “one team”. If “ecology” is not well understood, we can understand it as an “alliance”. So there is no question how the current team supports so many businesses. The only question is that if you let each innovative project find the right path and method to develop or evolve faster.


Q11: FMex proposes community governance, in which areas will the community play a key role? What kind of competitiveness does community-based governance bring to a contract exchange?
A11: Community governance is one of FMex's four features. The first thing to understand is why do we want community governance? This is a question of ownership. Ina private company, the CEO or the board of directors is in charge, serving only minority shareholders. The decision-making of a company is internals determine.
But we believe that all platform-level business organizations must be community-oriented because all the decisions will affect the users. If the platform users do not have the right to speak, it is likely that the various decisions of this business, organization violates or even harm the interests of the users.
Ina free competitive market environment, you hurt the user and the user will vote with his foot. Your core value is the user. If the user has no speaking right for a long time, it will definitely lead to the bottleneck and challenge of the platform, which makes it difficult to prosper.
The competitive advantage that community governance brings to a contract transaction is to let the users of the platform truly participate in the decision-making of the platform development. By a number of mechanisms design including sustainable mining, we let users be the owners of the platform. At the same time, through community-based governance, the platform is developed in a direction that benefits the interests of users, rather than serving the private interests of a few people.
This is also the essence of the token economics that I believe: the true integration of the owners and users of the platform. You may not have a specific concept of community governance. I can take FCoin's practice as an example. Today we have just completed the FCoin White Paper 2.0 update community referendum, a whitepaper initiated and compiled by the FCoin community. I believe that there is a milestone meaning in the history of FCoin and even in the history of blockchain development. This is one of the fruits of FCoin's community governance.
FCoincommunity has produced 305 proposals, passed more than 50 major resolutions, including FT issuance termination, differentiated fees, and sustainable mining from community referendums since last August. So, whose FCoin is this? For the community, the answer is obvious. I also hope that FMex will be like this in the future. Let all wait and see.


Q12: The amount of funds raised by FMex is 30 million US dollars, which is more than the previous projects.What is the reason?

A12:The amount of US$30 million may be slightly larger than the IEO project of other exchanges before, but in fact, it is not a large amount of fundraising in the entire blockchain industry. For example, you probably know the size of the EOS fundraising.

HereI want to highlight a few points:
Firstly, the $30 million looks absolutely not small, but we share 30% of FMEX with investors, which is quite large compared with early investment.
Secondly,the overall valuation of 100 million US dollars does not seem to be small (of course, it is not too big in the blockchain industry), but everyone should consider that this is a contract exchange with huge profitable space and will be launched soon. far from the general "we do not know where the value is or a project whether can smoothly online on the main net in a long-term (many are more than 1 year) that" ordinary public chain project can be compared”,
Thirdly, another data that can be referenced is that FCoin's private offering valuation before the launch is also $100 million, while FCoin was not online at the time with no one user then. This is nothing compared to what FMex is now doing based on "FT ecology, which already has a strong community base".

Q13: FCoin'ssuccess comes from “Transfee Mining”. FMEX is like an enhanced version ofFCoin. You said in the past few days that “the most fundamental goal of FT public chain is to solve the problem of how to divide the cake.” The focus of FT ecology seems to have always been the economic model from an overall view,that is, how to divide the money, is this the case? How do you think of it? In addition, will FMEX take measures to robot high-frequency trading?

A13:This question, I think if you understand the mechanism of Bitcoin, or read my book, it should be easier to understand.
The success of Bitcoin is not only the success of the technology but also the success of economic system design. This has already penetrated into the blood of the blockchain. Without a good economic model, only depending on technology cannot achieve true "autonomy."
So returning to this question, the focus ofFT's ecology is to use technology to promote the evolution of the company to the community and promote the transformation of production relations. It is a question of how to divide the cake, that is, to solve the problem of production relations. I mentioned this at the FT ecological press conference, and you can check it out if you are interested.
Regarding the issue of robotic high-frequency trading, the contract exchange, and the spot exchange are completely different. For example, the depth of100-leverage sustainable contract on BitMEX is very exaggerated. At this depth, single brushing is very difficult, and it is definitely necessary to participate in the trading. As long as it participates in normal trading, it is a part of the trader, we will study how to solve it later if there are some abnormal behaviors.

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2019-6-8 09:15
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写的不错,赞一个
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2019-6-8 23:47
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每天都在抢,抢也抢不到
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2019-6-9 12:17
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每天学习英文
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2019-6-9 21:45
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不错   赞赞的
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