Following a hectic ride lately, this week, Digitex Futures CEO Adam Todd made a huge announcement. We will be removing KYC from all aspects of the exchange from the end of this week. He then held a live AMA today to address your questions. If you weren’t able to attend, you can catch the full video below, or dive straight into the write-up.
No KYC on Digitex AMA Kicks Off
Adam starts off by welcoming everyone and reassuring them that Digitex is not doing anything illegal. We will be taking all possible measures to ensure that no U.S. citizens can access the exchange. This includes a blanket U.S. IP block on the website, a checkbox that you have to agree with that says you’re not a U.S. citizen, and a detailed T&C to agree with. “That’s all we can reasonably do, that’s my stance,” he says, and then he gets straight to your questions.
Q. When going live without KYC and a huge number of people who might come to the exchange, will it not make for a horrible experience sending them to other exchanges to get DGTX first? If the quarterly Treasury is empty before launch, how complex would it be to make a simple ETH/DGTX spot market like Mercatox as early as possible?
A. Adam replies that, no, in actual fact, “No KYC is a thing of beauty.” He says that right now making people do KYC before they can access the platform and “fall in love with it” is a horrible experience and we lose a lot of people. Adam believes that having KYC in place will destroy the business.
What new signups will now be able to do is log in and deposit either DGTX or ETH into their Digitex Futures trading wallet. It will then go automatically to the Treasury and be converted to DGTX at the current CoinMarketCap rate and sent back as DGTX to the trading account.
“We are literally going to have 10 times more users without KYC,” he says. “We no longer have to send people away.”
Q. What if the Treasury runs out of money?
A. Adam replies that the current way we have the Treasury set up would mean that it empties out after every 10mn tokens. So, in order to get around this and ensure that the Treasury is always topped up and DGTX buyers don’t have to go off to Mercatox or another exchange first, Digitex will take the ETH and send it back to the exchanges to buy DGTX when the Treasury is running low.
“This converts to a very smooth onboarding method,” he says. He explains that the exchange itself is going to be constantly buying DGTX from the open market to meet the demand in the Treasury contract. This is going to be very good for the project and the token. Adam clears up the fact that it will all be “above board and transparent.”
Q. Will the team publish information about how much DGTX they bought from exchanges at the end of each day for transparency reasons?
A. Yes, Adam confirms that you will see everything, all the transactions will be viewable on the Ethereum blockchain and it will be completely transparent.
Q. Is the Treasury price going to stay above exchange prices so that the team can make money to run the business?
A. Adam says that it will not. He explains that the team does not need to make money from the additional tokens bought to top up the Treasury. So, the Treasury price will probably be the same as CoinMarketCap, maybe a very slight 2% premium.
Q. Is it possible for authorities to approach AWS and shut down Digitex servers due to non-compliance? Amazon is a U.S based service provider and all Digitex servers use AWS cloud.
A. Adam confirms that AWS “are our server people.” However, he says that he doesn’t believe that they will do that. Digitex is not doing anything illegal. We are clearly being closed off to U.S. people. When U.S. people visit the homepage, they get a message to say that they cannot view it. When buying tokens, you have to state you are not from the U.S., so, Adam asks, “Are they going to come after our server providers and shut us down? I don’t think so. If they did, there are other server companies in the world. Digitex is not a U.S. company, and we are not marketing to the U.S., we can put our servers where we want.
Q. I read on Cointelegraph there will be no fiat currency trading ever, is this the case?
A. Adam confirms that we will never have any fiat on our exchange. This is because you absolutely need to have KYC if you are dealing with fiat currencies and traditional finance. “It’s a matter of law… Forex futures with crypto are a different thing but buying and selling fiat, no.”
Q. Since there will be no KYC, is the limit per person in the Treasury also going to be revoked?
A. Adam says that currently, the limit is 1 million DGTX per quarter per person. But, honestly, it is easy to get around anyway. So instead of pointless rules, he says it’s better to have no rules. He confirms that there won’t be a limit on the Treasury.
He gives the community a heads up that they will see some strange-looking action on the Treasury soon. As the Treasury is a smart contract and you cannot change smart contracts, he is going to have to buy 1mn DGTX 10 times from 10 addresses and put those in a new contract that does not have the KYC requirements.
Q. Post mainnet launch, to what extent will SmartDec contribute to the back office support system especially on daily withdrawal of money by investors/traders from mainnet, management of sub-accounts through the main account?
A. Adam clarifies that he loves SmartDec to bits but they build software and that’s what they do. They are not interested in managing the exchange. They have nothing to do with KYC policy either as they don’t care, they are just building software. They won’t be managing the back office on the mainnet, he says, “we have a different company to do that.”
Note, many people listening to the AMA misunderstood what Adam meant. While SmartDec will not be running the back office, which is mainly support and customer service, we are not parting ways with them either. They will still be working on developing the exchange further, adding more features, working on the spot markets, and also monitoring and maintaining the security of the exchange. Fear not, we have absolutely no plans to end our relationship with this amazing team of developer talent!
Q. What about adding metals, commodities, Forex, etc. to Digitex. Won't there be any problem from governments to add these markets if we don't have KYC?
A. Adam says that it’s another gray area. However, we are going to have futures on metals, commodities and forex pairs but they are all settled in cryptocurrency, in DGTX. He believes that we don’t need KYC to do this… However, “I guess we’ll find out,” he says.
Q. Will you now accelerate efforts to transition to a fully decentralized exchange and DAO structure to ensure the U.S. cannot interfere in the operation of the exchange in the future?
A. Adam says that he doesn’t think that they will interfere since we are not disobeying any rules. He says that he would love to be fully decentralized and a DAO but “it’s not that simple.” He says that we are still doing research on and it’s very difficult. Also, the way that Adam wanted to do the DAO could invite a whole bunch of regulatory issues that he wants to avoid at the moment. However, as soon as we can, we will be all over it.
Q. What are the withdrawal restrictions per day? Will these be able to be raised if a user does KYC?
A. Adam says that you can get around these withdrawals per day, so we are going to remove them. There will be no withdrawal limits on the Digitex exchange nor any KYC.
Q. Is there anything that we, the community can do to spread the word? Will you be sending out shareable marketing posts for social media?
A. Adam laughs and says that yes, in fact, we have a hashtag. It is #IamwithDFE. He says that if you hate KYC as much as he does, and you think it has no place in crypto then just use it, tweet it, say it, and add that hashtag.
Q. The total supply went from 1b to 999,999,999. Was Digitex Futures exchange responsible for this burned token?
A. Adam says that no, it was not Digitex. He says that he was confused when he saw that and he asked a developer. It turns out that anyone can burn a token by sending it to the 0x000000... wallet address. He did not know that. But he says this is of no concern since if someone wants to burn any tokens it simply makes the existing ones more valuable.
Q. How is bug testing going?
A. Adam says that bug testing is going very well. He says that he doesn’t see any bugs now, the platform doesn’t freeze up, there is no more problem of trades disappearing and coming back. It is stable and robust and going very well.
Q. Is it possible that some people will be onboarded before April 27?
A. Adam does not think so but it is a development-led decision. He says that onboarding will also be led by them and done gradually like with the testnet, perhaps in batches of 20 or 50 at a time, however, he will be behind them doing his best to hurry them up!
He believes that like the testnet, we will have everyone onboarded very quickly. We will also be leaving the testnet up so that users can switch back and forth if they want to try out strategies without placing funds at risk.
Q. What are the marketing plans? Are there plans for before or after mainnet?
A. Adam laughs again and confirms that we have some awesome plans in the pipeline. However, he doesn’t want to reveal them now. “But, we have big plans and a bunch of stuff that will make you say “Damn, boy!” He’s pretty confident that we can hit 1000 signups a day in the near future with paid traffic, banners, influencers, and a “whole bunch of stuff going on.”
Q. What will you include in the T&C to ensure that no prohibited users sign up?
A. Adam says that he doesn’t know. He says we will include whatever the lawyer gives us. As already said, this will include no U.S. and all reasonable measures we can take to prohibit them.
Q. Since the DAO is postponed, is it possible to make the insurance fund pay some kind of interest to hodlers who lock DGTX into the Digitex DFE?
A. Adam says that no, probably not. That is not its purpose. Traders will already have the ability to make money from the market maker losses and also we will be adding rebates for market makers. He says, “If you hold DGTX, you can get a positive edge but not straight interest from the insurance fund.”
Q. Will removing KYC and the new UI design have an effect on the launch date?
A. Adam confirms that, no, it doesn’t affect anything. He says that the new UI is coming anyway and removing KYC makes things simpler. “It’s just a lot better and will get us 10 times more users,” he says.
He also says that the UI updates are coming along nicely and we are hoping to have the mobile version (note, not the app but the mobile responsiveness) on the testnet at the start of April. Adam says that this is exciting, and will open us up to so many more people when it looks good on mobile.
Q. Do you have DDoS attack prevention in store?
A. Yes, Adam confirms that we have had DDoS prevention in place and the developers are up on that. “That’s what they do.” He also says that most of the code going live on the mainnet is going to be frozen very soon. He says that it’s coming up to freeze point right now. Pretty much all of April will be “testing, testing, testing.” One huge part of that will be getting a bunch of hackers in and trying to get people to break it, steal money, “everything you can think of to really put it through its paces.”
So that wraps up another AMA! Let us know what you think on Telegram and of course, if you still have questions, be sure to join in the conversation. Have a great weekend everyone and thanks for your continued support.