Review on FTX Token by Stephen Toluwani
Utility of discounting trade fees is not on the good side with this token. But as an investment opportunity, it's great
The FTX Token is the utility token of the FTX exchange from which we can get a discounted trade fee rebate on our orders. Looking at the 33% yearly purchase of the FTX Token by the FTX exchange from their yearly profits so as to burn them in order to reduce the total supply, I think it's safe for me to say that it is a good investment for a long term. Infact, the value of the token currently is at a good price considering it's supply. Being an Ethereum token, details of the yearly buy-and-burn is available to see on the explorer.
Away from the investment scenery I discovered on this token, I want to also look into the utility of this token right on the exchange. Just like many other utility tokens of crypto exchanges, FTX token is used to get trade fee rebates from 3% up to 60%. Now this fee rebate in my view comes with a downside. My reason for pointing this out is because the trade fee rebate can only be given to its market makers, not only that, but also, there is a limit to the amount of rebate given by the token. I have never seen a utility token like this beforehand and this doesn't make it useful to me in terms of trading especially when one considers the high trading fees this exchange charges.
The only reason to holding this token is for it's overtime value and daily returns for staking because I feel it's use case for discounting trade fees is not good in any way.
Pros
- FTX Token is the main utility token of the FTX exchange and using a buy and burn model for it's supply, it is safe to say that the token will increase in value over time
- Holders of the FTX Token on the exchange gets a share value of the exchange earnings daily
- There is a trading fee rebate for holders of the token from 3% to 60% depending on held amount
- Users can stake their FTX Token for returns
Cons
- The discount or rebate on trade fees for hodlers of the FTX Token is limited only to the market makers
- The trade fee rebate given to the market makers has a limit
