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Trading Strategies



What is 1Fox?

On 1Fox you can make leveraged trades on one of our markets and profit from rising or falling prices. Deposits, withdrawals and trades are credited in your account’s base cryptocurrency like Bitcoin. 1Fox is not an exchange where you can convert your funds to fiat currencies like USD or EUR - it is solely a platform to trade on market price movements. Have a look at our Trading Strategies to see what 1Fox can be used for.

Cryptocurrency & Bitcoin

Cryptocurrencies enable users to send and receive payments without the need for a middleman or central authority. Bitcoin is the first and most prominent cryptocurrency which was released as open-source software in 2009 and is an accepted currency on 1Fox. Acquiring cryptocurrency is, in most countries, very simple - you can find a lot of platforms that offer such a service with a simple Google search. The price of cryptocurrencies is based on demand and supply.

Creating an account

Creating an account only takes a few seconds and only a valid email address is required at the moment. Make sure to read and understand our Terms of Service before you create an account.

Depositing funds

Before you can trade on 1Fox, you need to deposit cryptocurrency via the "Deposit" page. If you have no experience with cryptocurrencies, make sure to educate yourself about the basic concepts of this technology. Deposits are free of charge and are automatically credited once confirmed.

Making your first trade

Once you have a positive cash balance, you can open your first trade on 1Fox. Simply click on the orange or black button on the market overview page to open the order create dialog. The required fields are:

Amount The amount you want to trade with. (e.g. 0.1 BTC)
Long vs. Short When you open a long position, you will profit from a rising price. When you open a short position, you will profit from a falling price.
Leverage A higher leverage can significantly increase the returns but also amplifies the potential losses. Use the profit/loss calculator to get a better understanding of this multiplier.

We suggest that you start trading with small amounts and low leverages to get a better understanding of the trading platform.

Withdrawing funds

You can withdraw your funds at any time on the "Withdraw" page. Withdrawing funds is subject to a small fee to cover our transaction costs. Outgoing transactions are processed fully automated and it should only take a few seconds until they are propagated to the network.

Forced Liquidation/Stop Loss Limit

Every position has a stop loss price which acts as a trigger for a market-close order if the index price reaches it. If no stop loss price has been set, it is automatically set to the minimum/maximum stop loss (around a -80% loss) beyond which the stop loss price cannot be set. The actual exit price depends on the available orders in the order book, therefore the stop loss price is never a guaranteed exit price. Especially if markets move fast or if you use a high leverage there may be a significant difference. However, on 1Fox you can never lose more than you initially invested in a position.

Trading Strategies

The speculative long/short trade

By far the most popular trading style is to speculate on rising or falling prices. If you believe, for example, that Bitcoin gets banned by a big country in the near future, you could open a leveraged short trade on BTCUSD and profit from a falling market price. If you believe that big financial institutions are going to invest in Bitcoin, you could open a long position and profit from the expected market price increase.

Hedging your cryptocurrency (Bitcoin) against price declines

Opening short positions is great way to hedge your cryptocurrency against price declines.

Consider the following example: The Bitcoin price is at 9000 USD and you own exactly 1 Bitcoin. You have the fear that the Bitcoin price could decline in the coming months and want to keep your USD value. This can be achieved by opening an unleveraged BTCUSD short position with a size of 1 BTC:

If the price falls from 9000 to 5000 you would profit with +0.8000 BTC. The total account balance of 1.8 BTC at a Bitcoin price of 5000 is exactly 9000 USD, your initial USD net worth. If the price rises from 9000 to 14000 you would lose -0.3572 BTC. However, the remaining account balance of 0.6428 BTC at a price of 14000 is again 9000 USD.
Profit/Loss Calculator

The above calculation does not take into account the funding payments (see Lending fiat currency) and assumes that you open unleveraged positions only. If you own 10 BTC you can also hedge this sum by opening a 2 BTC short position with a leverage of 5. However, keep in mind that leveraged positions can be force-closed (liquidated) much earlier when the market moves against your position too much.

Lending fiat currency

On average, it can be expected that the funding rate is positive - you can find detailed funding history statistics in the trading panel. This means that long positions pay and short positions receive funding payments in the long term. Opening short positions can be interpreted as lending fiat currency to long traders.

Consider the following example: The average funding rate is 0.05% per day on the BTCUSD market and you intend to "lend" USD to others. This can be done by converting USD to BTC, transferring these BTC to 1Fox and opening an unleveraged short position. In the above section (Hedging your cryptocurrency (Bitcoin) against price declines) we learned that short positions keep a fixed value in terms of USD no matter how the market price moves. If we hold such a short position over a longer period of time and the funding rate remains positive, the USD worth of the position will constantly increase. To "realize" these profits, you have to close the position and convert your BTC back to USD.

A side-effect of this trading strategy is that you are virtually not exposed to BTCUSD price movements, which is certainly a pleasant feature for some traders.

Arbitrage trading

Arbitrage is defined as the purchase of securities on one market for immediate resale on another market in order to profit from a price discrepancy. This results in immediate risk-free profit.

An example: Imagine that you can enter the BTCUSD market (go long) at a price of 8000 and exit it at 8050 on another exchange or trading platform. Making these two trades will not change your BTC or USD exposure, but you will profit from the price difference instantly.
Of course there are also more advanced strategies like placing a Limit Order at a price below/above the potential entry point of another market. Once your Limit Order gets filled you can instantly "rebalance" your exposure by making a Market Order on the other trading platform with an instant profit.

For efficient arbitrage trading we recommend building software on top of our API.

Market making

A market maker places an order on the buy (long) and the sell (short) side of the order book hoping to make a profit on the bid-ask spread. Especially in times of low price volatility, the volume of buys and sells will be roughly the same. A market maker can generate profits by constantly "buying low" and "selling high". On most exchanges there are many competing market makers which rely on sophisticated trading algorithms.

Foxbot is a market maker bot that is built on top of the 1Fox API for demonstration purposes. It is a helpful template to build upon.


Delayed (pending) deposits and withdrawals

It can take 0-48 hours until cryptocurrency transactions are "confirmed" by the network. The exact time depends on the cryptocurrrency and the number of transactions that are currently initiated. Especially when exchange price volatility is high, there can be delays due to network congestion.
However, once transmitted to the network we have absolutely no control over the time it takes for transactions getting confirmed and we cannot speed this process up for you. Please only contact us if transactions remain unconfirmed for more than 48 hours.

I have lost access to my Two-Factor Authentication!

Oh no! If you are using "Two-Step Token" make sure to back up the secret as advised in the setup process in the future. Fortunately it is possible to regain full access to your account by requesting a Two-Factor Authentication reset.

Unauthorized account access

You are likely here because you received an email informing you about someone accessing your account. If this wasn't you, your account is likely compromised and you should act immediately. Your funds are in danger!

What to do next?

  • Make absolutely sure that you switch to a secure device that is not compromised - Android and iOS smartphones can be considered as safe.
  • Protect your email account (like Gmail) by changing the password to a unique password that only you know - never store this password on a digital device.
  • Once your email account is secured, also change the password of your 1Fox account.
  • Cancel all pending Two-Factor Authentication requests, if they were not initiated by you.
  • From now on, never open 1Fox or your email account on a device that could be compromised.
To protect your IT infrastructure, you should consider contacting an IT professional and try to find out how this attack was possible.

How could this have happened?

In most cases the attacker logs directly into an account, which means that they knew your email/password combination. You can find detailed information in the "access log" visible in the 1Fox trading panel.

There are several possibilities for how that information is known by someone else. This includes, but is not limited to:
  • There is malware on your computer which logged your keyboard input and sent this data to the attacker. From our experience, this is the most common attack.
  • Your email account is compromised and the attacker managed to reset your 1Fox password.
  • You entered your credentials on a fake website. (Phishing attack)
  • A 3rd party website/service (possibly cryptocurrency related) was hacked and the attacker reused your login credentials from there. Sites like haveibeenpwned.com can provide you with some information of where your credentials may have been leaked.
  • You used a very weak password that was guessed.

What are you waiting for?

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