What is the premarket. On the example of the largest cryptocurrency exchanges
In the market of digital currencies there is an opportunity to earn on new tokens before their release. How the cryptocurrency premarket works, how it differs from the classic and on what sites is represented
Traditional markets work at certain hours on weekdays, and traders have the opportunity to leave orders before the start and after the end - premarket and postmarket. It is this data that becomes the basis for forming the price of the asset at the beginning of the trading session.
Crypto exchanges operate 24/7, without interruptions (except for technical works). At the same time, in 2024, against the background of a large number of eirdrops, the premarket has moved into the sphere of digital assets. This is a tool that allows trading in tokens that have not yet been issued, setting prices and conducting futures-like transactions.
How the premarket works
The premarket on crypto exchanges allows you to make money on tokens that have not yet been officially launched or listed on an exchange. As a rule, this instrument is calculated in stablecoins before the asset is released. It is assumed that in this way users can participate in the formation of the price of a new cryptocurrency. However, often the price on the premarket differs significantly from the real one in a big way.
Most often, the premarket works on the principle of deliverable futures. For example, in the case of the OKX crypto exchange, the instrument is settled in USDT on the expiration date. If the new asset was listed on the platform, the calculation is made before the listing. At the same time, the exchange reserves the right to remove the futures in case the project team cancels the token issue or encounters other insurmountable problems or excessive risks.
Varieties of premarket venues
In addition to the pre-market futures described in the previous section, there are other platform options. For example, one of them is directly related to a TGE (Token Generation Event) - the official launch of a token on the blockchain and its distribution to users, investors, partners and other parties.
It works like this: a buyer places an order at a certain price, and the seller uses collateral to determine a sell order. The transaction has a deadline (most often given a few hours after TGE to fulfill the order). Otherwise, there is a penalty.
Another option is trading in points (reward points for activity in the project, like a loyalty program). In this case, unlike TGE, a point does not guarantee receiving tokens. Points have no value and can only potentially be converted into real assets in the future.
There are even decentralized pre-marketplaces that operate on the same principle as other DEXs. They operate under smart contracts and don't need a third party to act as a proxy.
Million-dollar trading volumes of pre-market markets
In only two months, the trading volume of Hamster Kombat premarket futures on crypto exchanges Bybit and OKX exceeded USDT 2 million. The amount of transactions on OKX is five times higher than on Bybit.
Hamster Kombat's TGE and the token's eirdrop are expected on September 26. On the same day, OKX will launch spot trading of the altcoin paired with the USDT stablecoin. It is important to consider that often such dates are not finite. Cryptocurrency projects tend to postpone dates because they can't always handle the influx of users.
