Frequently Asked Questions
Do you have any questions regarding Babylon DEX? If so, here are some frequently asked questions that may help
Last updated
Do you have any questions regarding Babylon DEX? If so, here are some frequently asked questions that may help
Last updated
A decentralized exchange (DEX) is an exchange platform that allows users to trade cryptocurrencies and other digital assets directly, without the need for a central authority or third party. Unlike traditional centralized exchanges, DEXs operate autonomously on the blockchain, meaning they are not subject to the regulations of a single entity. This provides users with more control over their funds and security against potential hacks or malicious actors.
The main advantage of using a DEX is the increased security and privacy when compared to centralized exchanges. With a DEX, users can trade without having to trust a third party with their funds. Additionally, since DEXs are built on blockchain technology, they also offer more transparency than centralized exchanges, as all transactions are recorded on the blockchain and can be verified by anyone.
First of all, crypto perpetual trading pairs like BTC-USDT, ETH-USDT, ETH-USDC, etc., tell you about the asset you can use as margin to open your long/short positions. So, BTC-USDT suggests that you must deposit margin in USDT stablecoin to open a long/short BTC perpetual contract. Notably, a perpetual contract is a derivative similar to a futures contract but without an expiry date. The trading pairs vary from exchange to exchange.
This feature enables traders to hold onto their positions, even if the market moves against them, without being forced to take losses. By maintaining sufficient maintenance margin, traders can keep their positions open and wait for prices to turn in their favor again.
While perpetual contracts offer great flexibility, traders need to be mindful of the funding rate which ensures that the perpetual asset price remains closely aligned with the underlying asset price. To trade perpetual contracts successfully, it is crucial to practice careful risk management and gain an understanding of the associated risks.
DEXs are the foundation of DeFi, while DEX aggregators are the power tools for heavy users, since they allow for more cost-effective large transactions.
The emergence of DEXs and automated market makers (AMMs) in the cryptocurrency space has created a need for tools to assist traders in finding the most efficient and cost-effective routes for their trades. To address this need, DEX aggregators have been developed. These solutions scan live exchange rates across multiple DEXs and liquidity sources, and present traders with a list of the best options for the specific asset pair they are looking to trade.
Currently, DEX aggregators have reached a point where they possess their own liquidity pools, making it difficult to differentiate between them and DEXs. This emphasizes the composability of DeFi, as DEX aggregators are built on top of DEXs to cater to diverse user needs, bringing about a whole array of creative solutions, thanks to the competitive and interdependent environment.
For larger trades, DEX aggregators can be invaluable in providing the best possible price execution across the various DEXs. By grouping together multiple liquidity sources, these aggregators are able to find the most cost-efficient routes for a single transaction. This way, traders can benefit from gas savings and minimize the price slippage that can be caused by low liquidity. To assess the performance of a DEX aggregator, four key elements need to be taken into account: routing algorithm, sources of liquidity, current market state, and transaction size. Babylon is on the brink of revolutionizing the DEX space with its distinctive decentralized approach.
Babylon supports a wide range of digital assets across 30+ blockchains ( including Bitcoin, Ethereum, BSC, Dogecoin, Avalanche, Arbitrum, CosmosHub, Thorchain, Maya, Kujira and more) including native assets and tokens. The platform is constantly expanding its selection of supported assets, so be sure to check back regularly for updates.
Babylon Finance charges 0.25% affiliate fee, that is decreasing with transactions' sum. Also, be aware of fees that are applicable to each transaction on decentralized exchanges, contingent upon the network employed and the sum being transferred.
To get started with trading on Babylon, simply create a Web3.0 wallet account such as Metamask if you don't have one. Once your account is created, you can then deposit funds into your wallet. Once this is done you can start executing trades and managing your portfolio as desired.
Got questions? Stuck on something? Babylon's customer service is available 24/7 on discord via support tickets to answer any questions you may have about using the platform or trading digital assets in general.
Not yet, but Babylon is taking the necessary steps to ensure their platform is accessible anytime, anywhere. By developing iOS and Android applications, users will gain access to all the features of the desktop version, including portfolio management tools and passive income capabilities, enabling them to manage their finances from anywhere.
