Rethinking Derivatives Trading - Why the System is Broken and What a Better System Looks Like

The Hidden Costs of Traditional Products: Why the system isn’t built for traders 

In traditional markets, derivatives trading is fragmented into multiple intermediaries that add layers of cost and complexity and reduce capital efficiency for traders. Traders typically interact with a broker, who provides access to products of third party manufacturers. Trading takes place on an exchange that then relies on external clearing houses to manage post-trade processes. Each layer takes its cut: brokerage fees, issuance spreads, trading fees, financing charges, margin requirements, and more. Altogether, the odds are stacked against traders.

This is especially visible with CFDs, a product still widely marketed to retail traders. While they appear simple—offering leverage and the ability to go long or short—they’re riddled with embedded costs and opaque mechanics. Overnight funding charges, wide spreads, and payout structures that tilt in the issuer’s favour mean many traders are set up to fail from the start. It’s no surprise that over 80% of CFD users lose money depending on the provider.

Add to this a structure that’s slow to settle and leaves traders exposed to counterparty risk—and it becomes clear: the current system isn’t built for traders.

Solving the Inefficiencies: The One Trading Way

At One Trading, solving inefficiencies means more than improving one piece of the puzzle—it requires rethinking trading altogether. Yesterday, we launched our perpetual futures exchange for institutional investors to rebuild the entire system under one technical and regulatory roof.

Instead of outsourcing key functions to different entities, we’ve created a vertically integrated platform. For the first time, product creation, order matching, distribution, custody, execution, position management and integrated risk management—across market, product, and counterparty risk—operate seamlessly within a single, regulated venue. Real-time settlement is no longer an afterthought; it is built directly into the core of our platform.

By removing external clearing houses, intermediaries, and their layers of cost and delay, One Trading simplifies what has historically been a complex, costly process. Everything happens within one vertical, unified system—resulting in faster execution, lower fees, and direct market access.

This structure enables us to do something genuinely new: offer cash-settled perpetual futures within a fully regulated environment. These are simple, transparent instruments with no expiry dates and no hidden rollover costs. Traders can take long or short positions, with up to 10x leverage, with clear margining rules and real-time pricing, all on a MiFID II-regulated venue, traded in a transparent central limit order book.

The impact is significant: traders gain greater control, better pricing, and reduced counterparty risk—all while operating within a MiFID II-regulated framework. This isn’t just an improvement—it's a fundamental shift toward a more transparent, capital-efficient, and fair market structure, accessible to both institutional and eligible retail clients in a single venue.

Why It Matters

This isn’t just about speed or user experience—it’s about fairness. A system where 80% of participants lose isn't a system worth preserving. We believe that trading can and should work for traders. That means transparent pricing, faster execution, fairer products, and less capital locked up in inefficient structures.

Following the launch of institutional trading in our platform, we will soon expand access to eligible retail clients. By offering a transparent, regulated, and cost-effective alternative to traditional derivatives we’re providing a purpose-built product that’s aligned with clients’ interest.

We believe the future of derivatives trading is onshore, efficient, and accessible. And this is just the beginning.

This post is commissioned by One Trading and does not serve as a testimonial or endorsement by The Block. This post is for informational purposes only and should not be relied upon as a basis for investment, tax, legal or other advice. You should conduct your own research and consult independent counsel and advisors on the matters discussed within this post. Past performance of any asset is not indicative of future results.