Is the rise of derivatives trading a risk to retail crypto investors?

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If retail investors gain bad experiences from derivatives trading, the image of derivatives might be smeared, shunning new investors from going into this new form of trading, argues tempofeng, co-founder of perpprotocol.

Derivatives in DeFi bring the rewards but leave behind the inefficiencies that traditional finance offers. However, the crypto market is a volatile one, to say nothing of the complexity of trading derivatives on DEXs, in which retail investors have to learn to make the trades by themselves. These investors require guidance and knowledge on both DeFi and platform navigation when they enter derivatives for the first time.

Most new investors are not experts in DeFi derivatives and, as such, protocols are actually putting in more effort to welcome these new investors in such a way that they are not too ill-equipped to handle the torque in derivatives. There is more educational content on derivatives trading nowadays, whether on Twitter, YouTube, Medium or Discord. So, it’s much easier to learn more about derivatives trading in DEXs now than in the summer of DeFi back in 2020.

more regulations on derivatives. Without a positive user experience for retail investors, this may end up creating a negative stigma for derivatives trading.Retail investors can expect derivatives trading to become commonplace in the future, allowing anyone with a decentralized wallet to easily partake in trading. The popularity of derivatives trading will continue to rise, and derivatives protocols must focus on the experiences that they give to users to keep up with the demand.

 

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👑getting better!道可道非常道

Cool. Dumped Coinbase for finex anyway

tempofeng perpprotocol such contracts just laugh at сrурtocurrencies

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