Crypto exchange FTX has teamed up with liquidity platform Paradigm to launch spread trading, enabling users to take advantage of price dislocations with cash-and-carry plays.
Spread trading entails purchasing one security and selling another related security or legs on a single trade to produce an overall net positive value called the spread.
“Paradigm users will be able to trade the spread between spot, perpetuals and futures instruments on BTC, ETH, SOL, AVAX, APE, DOGE, LINK and LTC, all with guaranteed atomic execution and clearing of both legs on FTX. Efficient spreads trading will provide a multitude of benefits to our joint customers,”
wrote Paradigm in a blog post.
Some of the benefits include single click trading with no leg risk, yields for cash and carry trades, lower execution risks and 50% cheaper fees.
FTX CEO Sam Bankman-Fried stated:
“Paradigm is a leading network providing institutional liquidity for crypto derivatives, and we’re excited to expand on our relationship with a formal partnership to collaborate on product developments for both of our users.”
With this, FTX becomes the third exchange to partner with Paradigm after Bybit and Deribit to offer future spreads. However, spot trading as part of the spread will only be available through FTX.
Paradigm has a large client base of over 1000 institutions, including hedge funds, market makers, and over-the-counter desk, with trading volumes exceeding $10 billion per month.