Bitfinex, one of the top global crypto exchanges, has added margin trading support for bullion-backed stablecoin (XAU₮).
Announced on Thursday, the exchange is offering trading services against the US dollar, Bitcoin, and Tether. The pairs can be traded with initial equity of 20 percent and the platform is also offering maximum leverage of 5x.
In addition, Bitfinex also raised the maximum leverage of its BTC/USD margin trading pair from 3.3x to 5x.
Margin trading enables traders to borrow funds, usually from the exchange platform, to increase leverage, offering the potential for greater profits than in traditional trading. This, however, increases the risk of trading, especially considering the volatile nature of digital currencies.
Growing demand for stablecoins
Tether, a company known for its, launched the gold-backed digital currency last week. Per the company, it was introduced with the growing demand for asset-backed digital currencies.
One XAU₮ token represents one troy fine ounce of gold on a London Good Delivery gold bar and the gold backing each token has been stored at a Swiss vault, the company specified. For now, the coin is available as an ERC-20 token on the Ethereum blockchain and as a TRC20 token on the TRON blockchain.
Recently, many bullion-backed digital currencies including PAX Gold were introduced in the market. However, per Tether, its stable currency is the only product among the competition that offers zero custody fees.
Both Bitfinex and are controlled by the same parent company – iFinex. Meanwhile, the duo is facing a lawsuit brought by the New York Attorney General’s Office, alleging the firms for illegally serving New York clients and also for an unauthorized loan.
“Holders of XAU₮ obtain the combined benefits of both physical and digital assets,” Bitfinex noted. “XAU₮ token holders will be able to enjoy ownership of gold while avoiding drawbacks associated with physical gold, such as high storage costs and limited accessibility.”d
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