Lucid Exchange is a distributed ledger options exchange that is seeking official, registered status in the United States. Find out how it works today in our review.
What Is Lucid Exchange?
Lucid Exchange, found online at LucidExchange.io, is a distributed ledger options exchange seeking registration with the US Commodity Futures Trading Commission (CFTC) and the Securities and Exchange Commission (SEC).
The platform’s key innovation is its proprietary matching algorithm that allows individuals to directly trade (peer-to-peer) option smart contracts without the costs and delays associated with trading securities through traditional brokerages.
In layman’s terms, the key benefit of Lucid Exchange is that it offers trading with zero fees. The only fee you’ll ever pay with Lucid Exchange is the financing fees on any leveraged positions.
Lucid Exchange has a system that creates unique distributed ledgers for each security they sell. After an individual executes a trade, the system converts their Lucid Coin token (TRD) into smart contracts that dictate the terms of their position. When the contract expires, the position is liquidated into the respective percent profit or loss denominated in TRD.
All trading on the Lucid Exchange platform is done through the use of TRD tokens, which you can purchase during the ICO ongoing throughout August and September.
Overall, the benefit of Lucid Exchange is that it eliminates the need for costly reconciliations of disjointed ledgers between market players (intermediaries). That means users enjoy instant settlement at maturity and cost-free trading.
What Problems Does Lucid Exchange Seek To Solve?
Lucid Exchange seeks to solve some of the biggest problems facing the securities trading industry today, including:
Blockchain technology has made centralized markets obsolete. These centralized exchange institutions offer opaque services that can mislead market participants. Traders may be vulnerable to unjust prices, for example. At the very least, centralized marketplaces lack transparency.
Traditional brokerages leave investors subject to extreme liquidity risks. This can lead to problems like staggering and partial execution. The end result is low volume trading and wide bid/ask spreads that generate larger profits for financial intermediaries at the expense of users’ profits.
Traditional brokerages enforce a 1-3 day delay on the settlement of derivative securities. This imposes an unnecessary risk on derivative traders executing transactions at what they believe to be the quoted price, which can lead to significant negative price movements.
Traditional brokerages charge high transaction fees that can chip away at investors’ profits. The Lucid Exchange whitepaper claims that the average fee is $9 to enter a position and $9 to exit a position – both of which can chip away at the gains of the average investor. These costs are more than doubled for traders of derivative securities, who pay a base fee and incremental fees for each contract.
Interference From Financial Institutions:
Brokerages may face interference from financial institutions. These institutions may charge hidden fees, for example, and impede the transaction process in other ways. Institutions aren’t necessarily banks – they can also be transfer agents and high-frequency traders.
Delays Transferring Funds:
Depositing and withdrawing funds with traditional brokers is slow and inefficient. Transfers can take several days and add enormous costs onto the trading process.
Ultimately, Lucid Exchange plans to solve all of these problems by creating a more efficient, blockchain-based ecosystem.
Lucid Exchange Benefits And Features
Some of the proposed benefits of Lucid Exchange include:
- Cost Savings: Lucid Exchange charges no transaction fees. The only fee you’ll pay with the platform is any financing fees incurred by taking a leveraged position.
- Tight Bid and Ask Spreads: Lucid Exchange uses proprietary software to create tight bid/ask spreads through P2P matching algorithms. Traders can lock in a price and avoid losing profits to slippage.
- Transparency: Lucid Exchange gives investors a closer look at what’s going on behind the scenes. The exchange’s blockchain ledger is immutable and transparent to regulators and investors.
- No Size Requirements: Lucid Exchange lets investors purchase an option on a fraction of a share. There’s no requirement to purchase in lots of 50 or 100.
- Legality: Lucid Exchange plans to be the first blockchain derivatives exchange operating legally in the United States, which means traders are working with a compliant provider and their money is in safe, regulated hands.
- Security: The developers claim their exchange is built “using elite security principles, employing encryption that matches or exceeds that of most financial institutions.”
- Currency Hedging: Users can hedge their Lucid Coin (TRD) profits using fiat currencies through the use of conversion vehicles.
- Lightning Speeds: Trades are executed within 5 seconds at the quoted price on your screen. In addition, the blockchain options exchange will offer after hours trading.
Who’s Behind Lucid Exchange?
Lucid Exchange is led by CEO Ephi Zlotnitsky, Head of Strategy Michael Gord, Head of Compliance Alexei Silverman J.D., and Head of Development Vishwajeet Singh.
You can get in touch with the team by email at [email protected]
TRD Tokens And The Token Sale
The Lucid Exchange token sale is taking place throughout August and September. Traders can use TRD to buy and sell future derivatives in the Lucid Exchange marketplace. You can use TRD to take a trade position in the marketplace, for example, post margin if an investor has elected to leverage his or her portfolio and pay financing fees on leverage.
Your funds are managed through the LucidWallet, a blockchain wallet available free of charge from LucidExchange.io.
A total supply of 10 million TRD coins will be released.
Lucid Exchange Conclusion
Lucid Exchange, also known as LucidExchange (with no space) is a trading platform that offers no fees. The only fees you pay are for financing a leveraged position. Aside from that, the company plans to undercut traditional brokers with cheaper costs and better profits for investors.
The platform revolves around the use of the TRD token. You can use TRD tokens to buy and sell future derivatives in the Lucid Exchange marketplace.
To learn more about the Lucid Exchange project, and how they plan to compete with traditional brokers and exchanges, visit the organization online today at LucidExchange.io.