Connect with us

Gate Investor

Investing In GateToken (GT) – Everything You Need to Know

mm

Updated

 on

Securities.io is committed to rigorous editorial standards. We may receive compensation when you click on links to products we review. Please view our affiliate disclosure. Trading involves risk which may result in the loss of capital.

For years now, cryptocurrency exchanges have been introducing their own native cryptocurrencies in order to provide additional benefits for their users and become more competitive in the rapidly growing crypto industry. Offering good prices and user-friendly services was beneficial, but as soon as exchanges realized that they can attract more people by offering special benefits available through their native cryptos, platform cryptocurrencies were born.

Take Gate.io as an example — the exchange offers a lot to its users, including competitive prices, decent fees, and it was always attractive to investors and traders as it was always among the first to list new coins and tokens. However, with its GateToken (GT), the platform can not only offer new benefits, but also solve certain problems within its ecosystem.

What Problems Does GateToken (GT) Solve?

As mentioned, GateToken can be used to solve certain issues, which is beneficial for both, the platform and its users. In doing so, it improves the quality of the entire industry, even. For example, GT can be used for:

Facilitating liquidity between different currencies

GateToken is a native token of Gate.io exchange, and as such, it is used for a variety of purposes. One of them is for facilitating liquidity between various cryptocurrencies through cross-chain atomic swap protocol services.

Powering the GateChain

Another of the token’s use cases is its ability to serve as gas to power the entire GateChain. This is not something unique to Gate.io and GateToken, as pretty much all exchanges do it now. But, it is still something that ensures that the network would run properly, and it gives the token a valuable use case that will always remain for as long as the network is being used.

Buybacks & Burns

Another common use case, or rather a mechanism involving platform tokens revolves around buybacks and burns. Essentially, the exchange is slowly but surely purchasing its own tokens from circulation, and sending them to a smart contract that can only receive funds, and not let them back out. In doing so, the exchange is actively reducing the supply of its own token, which is meant to increase its value.

According to the project’s buyback program, Gate.io set aside 20% of its operating profit for GT buybacks and burns. 75% of the tokens are bought from open markets, and 25% comes from the reserve for marketing and ecosystem growth. The project also said that it will publish burn transactions every 3 months, for transparency purposes.

Benefits of GateToken (GT)

So far, we have seen how GT can be used to improve the project’s ecosystem and the exchange’s services. Now, let’s take a look at what it can do for the users. You can benefit from holding and/or using GateToken in several ways, including:

Gas fee discount

When you make transactions on any exchange, you are expected to pay for gas fees. These are fees that the exchange itself charges for its services of listing tokens, providing liquidity for them, and allowing users to complete their trades quickly, in a safe environment, and for matching buying and selling orders. These fees should not be confused with the coins’ own fees, which are paid to their miners for processing transactions.

However, a lot of exchanges are willing to drop the amount that you need to pay in fees, or even to completely eliminate it for those who hold their tokens. These trading fee discounts are available on Gate.io if you hold GT, and you can apply them for SpotTrading, Future Trading, and even Crypto Lending.

Voting

Another popular use for platforms’ native tokens is for voting. In DeFi, voting is used within DAOs to help decide the future of the projects, propose changes, and alike. On centralized platforms, it doesn’t work quite like that, but the platform still allows its token holders to join the voting program and vote which tokens should be taken into consideration for being listed on the exchange’s platform. Users will, of course, have access to all active tokens, and each GT token that they submit is equal to 1 vote.

The more tokens you submit, the greater the weight of your vote, so if you really wish to make an impact – you can, provided that you have the funds for it.

Best of all users who vote will be rewarded with airdrops from the token they voted for.

HODL & Earn

Finally, Gate.io also allows its token holders to earn passive income in several ways. At the end of the day, all that really matters is that the user is holding the exchange’s cryptocurrency in their wallet, and they can earn interest on a monthly basis. It features lock-up programs that offer high rates of return, and there are no early withdrawal penalties or fees. That means that you can still withdraw your tokens for whatever reason whenever you like, and you will not be punished in any way. Plus, all the rewards that you already earned will be yours.

How Does GateToken (GT) Work?

GateToken (GT) is a unique token of Gate.io cryptocurrency exchange. It is a token that is deeply connected with the exchange’s chain and the way it works, as it is being used for powering the platform, paying gas fees, facilitating liquidity between cryptos, and much more, as discussed above.

The most important thing about it is the fact that it provides a high-performance trading experience to the exchange’s users. In addition, it also brings benefits such as fast transactions and fee discounts. And, of course, since the platform is using the token for buybacks and burns, there is a rather good chance that owning the token could be beneficial — not only due to the passive income that it carries, but also because its value could eventually grow and bring profits in this way, as well.

How to Buy GateToken (GT)

GateToken (GT) is available on the following exchanges: 

Gate.io – This exchange was established in 2013, and is one of the more popular & reputable exchanges. Gate.io currently accepts most international jurisdictions including Australia & the UK.  Canada & USA Residents are prohibited.

Since the majority of the benefits for hodling GT are seen on the Gate exchange, Gate.io is clearly the best exchange to buy this token.

Huobi Global – Established in 2013, Huobi Global has since become one of the world’s largest digital asset exchanges, with an accumulated trading volume of US $1 trillion.  It should be noted that Huobi Global currently does not accept USA or Canadian residents.

GateToken (GT) — The native token of Gate.io exchange

GateToken carries a lot of benefits with it, which is enough to ensure its eventual price growth by itself. And, since it does provide all the perks and advantages discussed above, it is worth holding it even if the price increase wasn’t a potential benefit. In the end, it serves as a good example of what an exchange’s native token should be like, what benefits it should offer, and how platforms can make use of an asset of this type to improve their services and attract new users.

Ali is a freelance writer covering the cryptocurrency markets and the blockchain industry. He has 8 years of experience writing about cryptocurrencies, technology, and trading. His work can be found in various high-profile investment sites including CCN, Capital.com, Bitcoinist, and NewsBTC.

Advertiser Disclosure: Securities.io is committed to rigorous editorial standards to provide our readers with accurate reviews and ratings. We may receive compensation when you click on links to products we reviewed.

ESMA: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. Between 74-89% of retail investor accounts lose money when trading CFDs. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.

Investment advice disclaimer: The information contained on this website is provided for educational purposes, and does not constitute investment advice.

Trading Risk Disclaimer: There is a very high degree of risk involved in trading securities. Trading in any type of financial product including forex, CFDs, stocks, and cryptocurrencies.

This risk is higher with Cryptocurrencies due to markets being decentralized and non-regulated. You should be aware that you may lose a significant portion of your portfolio.

Securities.io is not a registered broker, analyst, or investment advisor.