USDT is a cryptocurrency asset issued by Tether Limited and is backed by one US Dollar for each unit. Credit default risks have been lingering due to lack of transparency and regulations. To provide certain risk hedge for users, CoinEx now releases a “USDT Credit Default Swap Contract”
with the rules as follows:
1. Each CDS contract is specified with contract value and delivery time. It includes two parts -1 contract A and 1 contract B both of which are available for trading in markets.
2. When a contract term is due and delivered, the holder of each contract A will get the amount that equals to USDT/USD from the value of a CDS contract, and contract B holder gets the rest.
3. The price of delivery will be the 24-hour average price before delivery time.
4. Before the contract is due for delivery on each term, anyone can create a new contract or convert back to the value of a CDS contract with 1 contract A and 1 contract B.
5. We are releasing two CDS contracts against BTC and BCH respectively with the names of USC and USH. 1 USC contract is worth of 1 BTC and 1 USH contract is 1 BCH.
USDT Price Index:
The USDT price index is a weighted average of USDT/USD prices from different exchanges. For now Kraken (www.kraken.com) is the only exchange we take reference from. USDT/USD price will be taken as 1 if it’s bigger than 1. The price index updates every minute. CoinEx reserves the rights to explain the index and change sources of USDT/USD prices.
There’s NO fee for creating new contracts or trading; 0.1% fee against the value will be charged for contract conversion and delivery.
1. When you spend 1 BTC to create a USC 0430 contract, you’ll get 1 USCA contract and 1 USCB contract at the same time both of which can be traded in BTC market. Or you can convert back to 1 BTC with 1 USCA contract and 1 USCB contract. When the contract is due and delivered at 24:00 April 30th 2018 (UTC), against the USDT/USD price e.g. 0.95, a USCA holder will get 0.95 BTC from a USC 0430 contract and USCB holder gets the rest.
2. If you believe there’s a default risk, you can choose to buy USCB contracts. When a default happens leading to a drop of USDT/USD price e.g. to USDT/USD=0.4, a USCB contract will get 1-USDT/USD=0.6 BTC.
3. If you don’t believe there’s a default risk, you can choose to hold USCA contracts and sell USCB contracts. If no default happens, meaning USDT/USD=1, each USCA contract will bring you 1 BTC and the amount you get from selling USCB is the extra profit.
USC0430 CDS合约：1 BTC可创建一份合约（包含1 USCA和1 USCB），
BTC Creation records
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