AAX Becomes First Crypto Exchange to Shift to Satoshis
Following years of calls in the crypto space to implement the Satoshi (SATS) Standard, cryptocurrency exchange AAX has become the first crypto trading platform to make the switch to SATS, prompting more exchanges to make similar moves. This transition is expected to make the crypto market more accessible to those who need it most, therefore, enhancing mass adoption. AAX is introducing the SAT-USDT trading pair, offering trades from 10 cents with zero fees starting from August 25, 9 AM GMT.
August 25, 2021
Switching to the Satoshi standard along with Lightning Network connectivity makes Bitcoin more tangible and yet easy to use. AAX has made the first move in the crypto space, already providing BTC to SAT balance conversion with a separate SAT-USDT market with minimum trade volume of 0.1 USD launching on August 25.
AAX believes that the adoption of SAT as a unit of measurement is an important and long-overdue process for the cryptocurrency community, since the new standard contributes to the spread of Bitcoin and helps new people, especially those from unbanked countries and regions with a lower level of cryptocurrency awareness, make their first purchase into this new form of sound money.
Mass adoption should not make the blockchain space look like the classical financial market, as it was never meant to be so.
The long-overdue switch corrects the “Bitcoin being expensive” bias
The Bitcoin community has been requesting such an upgrade for a long time, with big players supporting the new standard. In May, Mike Novogratz, tagging Coinbase, Kraken and FTX, called on crypto exchanges to switch to Satoshis, referring to the growing number of people saying the high price of Bitcoin stops them from buying it:
“It is time to switch to Satoshis. Too many people telling me at $58,000 $BTC too expensive. Which exchange will be first to quote in SATS?”
— Mike Novogratz (@novogratz) May 8, 2021
Following AAX’s announcement to heed Novogratz’ call, one prominent Bitcoiner and author of “21 lessons: what I’ve learned from falling down the Bitcoin rabbit hole” pointed out that the discussion had been going on for some time already.
Apart from hints by some exchanges such as OKCoin, it was Bitfinex who was next to make a significant move, announcing:
— Bitfinex (@bitfinex) August 6, 2021
Switching from BTC-USD to SAT-USD will allow people to be far less hesitant when considering the transition to using Bitcoin. Unit price bias is the biggest problem that has been underestimated for years, as an incredibly powerful barrier, and it significantly affects both the average retail investor and new user.
“We are confident that this is the beginning of an important trend and we are delighted to be at the origins of a new on-exchange metric system. I urge crypto exchanges and payment systems to pay attention to popularize the new standard as soon as possible, as this is the only real way we counter the idea that the Bitcoin ship has sailed and it’s only for the rich”, Toya Zhang, the Deputy COO of AAX, added on the matter.
Driving Bitcoin Adoption
In addition, an increase in the availability and ease of use of BTC is needed for its further popularization and adoption as a means of payment. However, with the growth of its price, the situation is developing in the opposite direction, since an expensive Bitcoin is less practical for regular payments for everyday goods and services.
As the industry matures, it is harder to gain access to BTC for the unbanked and generate organic demand. Commission surges may cost more than the amount traded and the less well-off are able to spend.
Meme coins are perceived as cheaper and end up in the hands of those who think they cannot afford Bitcoin and, consequently, those who might need it most turn to hype money, unsound money, or riskier investments.
The widespread introduction of SATS as a unit can correct the situation, as it is more convenient to carry out calculations in them. For example, a cup of coffee costs 10,000 SAT or 0.0001BTC. This is also a good marketing ploy for BTC, as users will now be buying 212,000 SAT, not 0.00212 BTC for $100. This is especially true for regions with a low standard of living and low availability of banking services.
“Of course, we understand the need to expand the Lighting Network to eliminate transfer fees to enable settlement in SAT, but AAX is taking the first step in this direction today — offering to buy SATS in the amount of 10 cents or more without commission. We are also exploring the possibilities of the Lightning Network to further optimize commissions on the platform with respect to deposits and withdrawals,” as Toya Zhang concluded.
Due to the smaller trade size market makers on AAX will need to deploy alternative hedging techniques and although small, within larger BTC movements this local market for SATS can be expected to chart its own unique price fluctuations. To optimally protect small holders, for any order above 50,000 SATS users shall be directed to the main Bitcoin market.
The transition to a simplified standard comes as part of the AAX exchange’s initiative to make onboarding easier for new crypto users. On August 5, the exchange canceled commissions for all spot pairs. Users will be able to trade in the SAT-USD pair for free as well.
The first trades in the SAT-USDT pair on AAX will be possible with a minimum order of $0.10 (214 SAT) and a maximum order of 50,000 SAT ($23) from the 25th of August.
AAX is the world’s first cryptocurrency exchange to be powered by LSEG Technology’s Millennium Exchange, the same matching engine at the heart of tier-one capital markets. AAX is a member of London Stock Exchange Group’s global ‘Partner Platform’.
Offering OTC, Spot, and Futures trading, quoting more than 50 cryptocurrency pairs and listing 5 perpetual futures contracts for Bitcoin, Ether, Litecoin, Ripple, and EOS, which can be traded with high leverage, AAX provides a secure, deeply liquid, ultra-low latency and fully compliant trading platform. It offers an institutional-grade platform, for everyone.