Foreign exchange is undoubtedly the largest and most liquid financial market in the world, with a trading rate of 5.4 trillion dollars a day. This is even larger than the crypto market as it only manages to exchange 4.8 billion dollars in one day. The foreign exchange market involves buying, selling and exchanging currencies electronically using computer networks. With forex being the largest financial market, it is quite easy to assume that there are no pain points associated with it. However, this is totally wrong as the available transaction process is inefficient and too complicated, and there is a lot of inconsistency regarding brokers.
So, what exactly are these problems?
Firstly, there are high fees that are incurred by traders, brokers and liquidity providers when withdrawing or depositing funds.
“For example, when you deposit to a forex broker, you deposit 1 USD to 35 Mauritian Rupees but when you withdraw, you withdraw 1 USD to 33 Mauritian Rupees. That means you lost 3-7% of your money with that trade.” Mr. Patrix Liu, CEO & Founder of FXPay in an exclusive interview with Decentral Magazine.
In addition, if a trader wants to exchange one currency for another, they incur a fee of 5-7% of the whole transaction amount. Moreover, there is a lack of consistency regarding broker fees due to lack of standardization.
Lastly, exchanging money is a very complicated process that can even take multiple days.
Overall, large forex platforms and broker platforms normally host investors that have over hundreds of millions of dollars daily. However, is it really fair to say that they truly have that amount if most of it is associated with unnecessary fees? A cost-saving solution is needed so that these investors can get the most out of their trading, and that solution is FXPay.
So, what is FXPay?
“FXPay is a new product that uses blockchain to be a gateway in the forex market. Forex is the biggest market in the world. It is meant to solve the problems and pain points that all traders around the world face.” Mr. Patrix Liu, CEO & Founder of FXPay
Essentially, FXPay intends to combine blockchain and forex so as to solve the aforementioned problems that exist in the forex market.
The team will introduce a digital currency to all brokers and traders thus, they can easily convert fiat currency to FXP tokens. After the investment into FXP, the trader receives 100% foreign credit on day 1. This means the individual can start trading immediately. When the conversion has been done and securely logged onto the blockchain, it can be converted to any FXPay forex pairs. Traders then use the forex credit to participate in the market. When the trading stops, the trader can convert the credit back into FXP or any other digital currency. There is, however, an option to keep the credit and trade with it at a later date or withdraw it into fiat currency through the Forex trading platform at a very low cost.
With this, traders can trade on an innovative platform with low fees and faster transaction times. This is quite awesome for everyone as traders get high-profit margins and investment potential. Moreover, FXP increases in value thus, everyone who exchanges to FXP will get more profit and cheaper transactions. This will create an immense cash flow within the ecosystem so as to build the FXP foundation and will, in turn, make the price rise steadily.
Is there an option for Crypto Investors?
Crypto investors are also given the opportunity to participate in the Forex trade market. They can use FXP so as to mitigate the problem of high market volatility by hedging. They can also swap their crypto for a more stable fiat currency until the market has stabilized. How awesome is that?
What is the benefit for brokers?
In order to get liquidity, brokers still use liquid providers. With FXPay, when brokers transfer money to liquid providers or banks, the platform will act as a payment gateway that offers discounts to these brokers. Moreover, FXPay intends to act as its own premium broker. Brokers can purchase FXP at a prevailing market price with a discount. They can then manage their own risk and profit to decide how much FXP they want to allocate to their traders or in-house exchange.
Why use FXPay?
- Utility coin: FXP is a utility coin that will increase in value as usage increases in the foreign exchange market via transactions.
- Payment Gateway: FXPay is a payment gateway for the foreign exchange market. It allows brokers to make instantaneous payments to liquidity providers through blockchain technology. Moreover, transaction fees are reduced from the normal 5-7% to a mere 0.5-1%.
- ERC20 Token: FXP is an ERC20 token meaning that it is based on the Ethereum network, one of the most reliable platforms.
- Smart Contracts: FXPay uses smart contracts which will save customers 90% as compared to current payment structures.
- FXPay Liquidity Providers: By the 3rd quarter of 2018, FXPay will be able to bypass middlemen by becoming their own liquidity provider, therefore saving users a lot of costs.
- Market Integration: The FXP coin can be merged with the crypto-market and the forex market simultaneously.
- Debit card: FXPay has a partnership with VISA/Mastercard so as to provide an FXP card that can be used for transactions worldwide.
- Social Wallet: After a KYC/AML process, FXPay users can create a mobile application social wallet that will allow the storage and transfer of FXP and forex credit.
- Mirror Trading
What is the team currently working on?
The team will finish ICO on October 31st and launch in November.
For forex traders and brokers, this is an opportunity to look out for. Good thing is that the company is still in its public sale thus if this is your cup of tea, then you know what to do.
This article is based on an exclusive interview between Decentral Magazine and Mr. Patrix Liu during the Mauritius Blockchain Conference. This event took place on Monday, August 13th, 2018 at the Intercontinental Hotel.