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HomeBBD TokenZero Fee Trading: Examples & Working

Zero Fee Trading: Examples & Working

Let’s go deeper on the working of Zero Fee Trading: the trading experience on both BTC / TUSD contract and BTC Zero / TUSD contract is the same. Except on the BTC Zero / TUSD contract, you do not have to pay any fees whatsoever! 

To trade on the Leveraged Zero Fee contracts, one must have BBD tokens in their wallet. BBD tokens are used as collateral for trading. 

Trading on Standard BTC Zero / TUSD Contract (ZERO Fees)

Let us consider an example of zero fees trading here : –

Emma does not have any BBD tokens but wants to avail zero fee trading. Although, she has 1000 TUSD in her wallet. She decides to buy 1000 BBD tokens at 1TUSD per BBD. Emma spends 1000 TUSD to buy 1000 BBD tokens in the BBD / TUSD spot market.

She proceeds to the BTC / TUSD Zero contract where the index is marked at 7000. This means, to buy 1 BTC / TUSD Zero contract, she needs to spend 7000 BBD tokens.

(Note – BBOD offers upto 50x leverage but leverage is not used in this example for simplicity.)

However, as she does not have sufficient BBD tokens, she cannot buy 1 BTC Zero / TUSD contract. She buys 0.143 BTC / TUSD Zero contracts instead. This is worth 1000 BBD. (Calculated as 1000 / 7000) .

Her current balance = 1000 BBD ~~ 1000 TUSD

Bitcoin gains 10% after some time. The price of BTC / TUSD Zero contract is 7700 now.

Her position is now at a 10% profit. This can be calculated as 

Position size * (Exit Price – Entry Price) = 

0.143 * (7700 – 7000) = 100 BBD tokens

Her balance after profit = 1000 BBD + 100 BBD profit ~~ 1100TUSD 

Fees paid = 0
Total Profit = 100 TUSD

Trading on Standard BTC / TUSD Contract (Standard Fees)

Let us consider an example of standard fee trading here : –

Emma has 1000 TUSD in her wallet. She proceeds to the BTC / TUSD contract where the index is marked at 7000. This means, to buy 1 BTC / TUSD contract, she needs to spend 7000 TUSD. 

(Note – BBOD offers upto 50x leverage but leverage is not used in this example for simplicity.)

However, as she does not have sufficient TUSD, she cannot buy 1 BTC / TUSD contract. She buys 0.143 BTC / TUSD contracts instead. This is worth 1000 TUSD. (Calculated as 1000 / 7000)

Her current balance = 1000 TUSD

Bitcoin gains 10% after some time. The price of BTC / TUSD contract is 7700 now.

Her position is now at a 10% profit. This can be calculated as 

Position size * (Exit Price – Entry Price) = 

0.143 * (7700 – 7000) = 100 TUSD

Her balance after profit = 1000 TUSD + 100 TUSD profit ~~ 1100TUSD

Assuming Emma placed a market order in all of these scenarios, we can calculate the fees as follows.

Fees = 0.075% * 1000 + 0.075% * 1100

Fees = 1.575 TUSD

Total profit = 100 TUSD – 1.575 TUSD

Total profit = 98.425 TUSD

Trading on Leveraged BTC / TUSD Zero Contract (ZERO Fees)

Let us consider an example of leveraged zero fees trading here : –

Emma does not have any BBD tokens but wants to avail zero fee trading. Although, she has 1000 TUSD in her wallet. She decides to buy 1000 BBD tokens at 1TUSD per BBD. Emma spends 1000 TUSD to buy 1000 BBD tokens in the BBD / TUSD spot market.

She proceeds to the BTC Zero / TUSD contract where the index is marked at 7000. This means, to buy 1 BTC / TUSD Zero contract, she needs to spend 7000 BBD tokens.

However, as BBOD offers upto 50x leverage on contracts, she only has to spend 7000 / 50 = 140 BBD tokens to open a 1 BTC / TUSD Zero contract

Her current balance = 1000 BBD ~~ 1000 TUSD

Bitcoin gains 10% after some time. The price of BTC Zero / TUSD contract is 7700 now.

Her position is now at a 10% profit. This can be calculated as 

Position size * (Exit Price – Entry Price) = 

1 * (7700 – 7000) = 700 BBD tokens

Her balance after profit = 1000 BBD + 700 BBD profit ~~ 1700TUSD 

Fees paid = 0
Total Profit = 700 TUSD

Trading on Leveraged BTC / TUSD Contract (Standard Fees)

Let us consider an example of standard fee trading here : –

Emma has 1000 TUSD in her wallet. She proceeds to the BTC / TUSD contract where the index is marked at 7000. This means, to buy 1 BTC / TUSD contract, she needs to spend 7000 TUSD. 

However, as BBOD offers upto 50x leverage on contracts, she only has to spend 7000 / 50 = 140 TUSD to open a 1 BTC / TUSD contract.

Her current balance = 1000 TUSD

Bitcoin gains 10% after some time. The price of BTC / TUSD contract is 7700 now.

Her position is now at a 10% profit. This can be calculated as 

Position size * (Exit Price – Entry Price) = 

1 * (7700 – 7000) = 700 TUSD

Her balance after profit = 1000 TUSD + 700 TUSD profit ~~ 1700TUSD

Assuming Emma placed a market order in all of these scenarios, we can calculate the fees as follows.

Fees = 0.075% * 7000 + 0.075% * 7700

Fees = 11.025 TUSD

Total profit = 700 TUSD – 11.025 TUSD

Total profit = 688.975 TUSD

Comparison

Comparing both scenarios, you may realise that zero fee trading is much better than its standard fee trading counterpart. 

Standard Fee TradingZero Fee Trading
Contract Name – BTC / TUSDContract Name – BTC Zero / TUSD 
Index Price – 7100Index Price ~ 7100
Collateral is TUSDCollateral is BBD
1 BTC / TUSD contract  = 7000 TUSD1 BTC Zero / TUSD contract  = 7000 BBD 
Upto 50x LeverageUpto 50x Leverage
Maintenance Margin, Initial Margin in TUSDMaintenance Margin, Initial Margin in BBD
Fees = 0.075% Taker; -0.025% MakerFees = 0

You can find the links for the zero fee contracts along with the BBD spot market below!

BTC/TUSD Zero Fee Contract (leverage upto 50x) – https://bbod.io/platform/symbol/CFX/BBD/BTC

ETH/TUSD Zero Fee Contract (leverage upto 50x) – https://bbod.io/platform/symbol/CFX/BBD/ETH

BBD/TUSD Spot Market – https://bbod.io/platform/symbol/SPOT/TUSD/BBD

We think leveraged Zero fee trading is a pretty cool use case of BBD tokens. We would love to know your thoughts! Hit us up on our telegram group – https://t.me/BBODCommunity. Looking forward to hear feedback and criticisms alike!

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