Trading
Swaps
Tokens within the 1K Liquidity Pool are exchangeable through swaps. To initiate a swap, visit https://app.1kx.trafe/earn. It's important to acknowledge that swaps enhancing the pool's balance incur lower fees. This fee structure incentivizes transactions that contribute positively to the liquidity pool's overall health. By utilizing this system, participants can optimize their token exchanges while supporting the stability and efficiency of the liquidity pool.
Web3 Wallet
To enhance your Web3 experience, utilize a popular wallet extension and ensure you have the correct token contract addresses when importing a token of interest. The contract addresses for 1KX, es1KX, and 1KLP are specified as follows:
[addresses will be available soon].
It's crucial to import the es1KX tokens into your wallet alongside other tokens of interest, as each trade is rewarded with es1KX tokens that can be converted to 1KX through a vesting process. This step enables you to monitor and manage your token balances efficiently within your wallet.
Smart Wallet (One-Click-Trading)
The Smart Wallet (One-Click-Trading) offers users an innovative alternative to traditional web3 wallet trading by linking directly to a preferred social media account for ownership verification. Transactions conducted through this smart wallet are entirely free of charge, ensuring a seamless and rapid trading experience without the need for extensive web3 knowledge. Security is prioritized with two-factor authentication (2FA), providing top-tier protection. Powered by the Shared Account Abstraction model outlined in EIP-4337, this approach allows users to efficiently manage their balances across various platforms, representing a significant advantage of this integrated system.
es1KX Rewards
Opening a Position
Perpetual trades on 1KX offer the flexibility of margining or collateralizing using any token from the 1K Liquidity Pool, enabling users to quote and settle trades in any underlying currency within the 1KLP pool. This feature allows traders to easily calculate their returns in their preferred token.
To begin, select the desired collateral token from the top bar. This selection determines the token that will be used to margin the position and settle gains or losses resulting from the trade.
Next, choose the trading pair located in the top left corner of the chart. This pair represents the assets being traded against each other and forms the basis for determining the outcome of the trade.
After selecting the collateral token and trading pair, indicate your market prediction by selecting "up" or "down" on the right side of the chart panel based on anticipated price movement. This directional choice is fundamental to executing the trade and determining its profitability based on market movements.
You can execute either a market order or a limit order. For more information on limit orders, refer to the Limit Order section.
Enter the collateral amount and choose your desired leverage. These parameters define the scale and risk level of your position within the trade.
Finally, click "Open Position" to finalize your setup. For information on associated fees, refer to the Fees section for clarity on costs related to opening a position.
Managing a Position
After opening a position on 1KX, traders can manage it through the interface provided. The details of the position, including Entry Price, Collateral Amount, Liquidation Price, Leverage, Funding Fee, Profit & Loss (P&L), and Return on Investment (ROI), are conveniently displayed under the "Positions" section located below the trading chart. These details offer essential information about the active position and its current status.
Traders also have the option to share these position details as an image using the share function, facilitating communication or record-keeping of their trading activities. This sharing feature enhances transparency and facilitates collaboration among traders or with other stakeholders.
Approximately 60 seconds after opening the position, the cashout option becomes active. This feature enables traders to potentially exit or close their position before the contract's expiration, providing flexibility and risk management capabilities during volatile market conditions. By utilizing the cashout feature, traders can make timely decisions and respond promptly to changing market dynamics, optimizing their trading strategies and outcomes.
Closing a Position
When closing a position using market orders, traders can initiate the process by clicking on "Cashout." This action allows for the timely closure of the position based on market conditions and individual trading strategies. Profits resulting from the closed position are disbursed in the selected collateral currency that was chosen at the beginning of the trade. This straightforward method of closing positions ensures efficient management of trades and facilitates the receipt of profits in the desired currency, aligning with traders' preferences and objectives.
Limit Orders
Limit orders offer traders a strategic approach to trading with two key inputs: limit and expiry time. The limit represents the desired entry price that the trader wishes to execute the order at. This allows traders to specify the price level they are willing to enter the market at, ensuring precision and control over the trade execution. Additionally, the expiry time parameter determines the duration after which the position will be automatically closed and cashed out.
By using limit orders, traders can lock in their desired entry price and define the timeframe for which they want to maintain their position. This feature provides flexibility and control over the trading process, allowing traders to implement precise strategies based on market conditions and individual preferences. Limit orders enable traders to optimize their trading approach by strategically managing entry points and trade durations to achieve their desired outcomes effectively.
Liquidations
Liquidation occurs when the price moves against the predicted direction, resulting in the loss of all collateral associated with a position. If a trader initiates a long position with a size that exceeds the value of their collateral, there will be a specific price level at which the loss incurred approaches or exceeds the value of the collateral.
The point of liquidation, which leads to a -100% Return on Investment (ROI), is determined by the chosen leverage. Different leverage ratios correspond to different liquidation thresholds. See the table below for different liquidation points corresponding to different leverages.
These thresholds indicate the percentage change in the asset price at which the position would be liquidated.
The non-round numbers in the liquidation thresholds are due to the Profit and Loss (PnL) fee, which affects the calculation. For more detailed information about fees, refer to the Fees section of the platform. Understanding liquidation thresholds and associated fees is crucial for traders to effectively manage risk and optimize their trading strategies based on leverage and market conditions.
Fees
A well-structured fee system is integral to maintaining fairness and sustainability within 1KX. The platform implements two types of fees: PnL Fee and Funding Fee.
PnL Fee
The PnL Fee is designed to incentivize larger positions by applying a decreasing fee structure, where smaller positive price moves incur higher fees compared to larger moves. This approach aligns fees with risk and rewards, encouraging strategic trading behaviors. Different slopes for various position sizes result in diverse fee structures. After a favorable price move of 10%, the PnL fee stabilizes at 10%, irrespective of the amount of gains. The fee profile adjusts according to the position size, as illustrated in the figure below.
Funding Fee
The Funding Fee is a periodic, fixed charge essential for the continuous operation of 1KX. This fee serves two critical purposes:
Sustainability: The Funding Fee covers operational costs, ensuring the reliability and longevity of the trading platform.
Fairness: Applied uniformly to all users, the Funding Fee maintains a level playing field for traders. The Funding Fee is applied at regular intervals, starting 8 hours after the position is opened, contributing to the platform's ongoing success.
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