When trading digital options on Spectre, whether it is cryptos, FX, or other assets, you will have no less than 4 different options pertaining to the account type you can use to place your trades. Let’s go through them to assess their pros and cons, and therefore decide which wallet you should use when trading on Spectre.

Different account types for every trader: Spectre ai

Spectre ai is a blockchain project. It has therefore a biais towards decentralization. But, unlike other cryptos projects, it does not intend to impose it to its users as a “take it or leave” offer. That’s why Spectre will offer so many different account types: completely decentralized, semi-decentralized and centralized (fiat). The last option being the digital options demo account. Don’t worry, you don’t have to create a separate account for each wallet type. You can conveniently add them (and toggle between potentially 4 account types within your Spectre account).

account types (wallets) in Spectre aii

Here are the different wallet types available on Spectre, and a brief summary:

  1. Wallet (mainnet): this is the fully decentralized account, you trade from your ETH wallet
  2. Regulat (mainnet): this is the semi-decentralized account. To trade you have to deposit ETH, but your funds are on the Spectre smart contract. The company has therefore no access to your money. Hence the name semi-decentralized (or semi-centralized, if you prefer)
  3. Old school wallet: this option will be available during the summer 2018. It will allow traders to deposit fiat like they do with any binary options broker
  4. Demo: this is the trial account, in which you can learn to trade binary options or experiment new strategies without risk

Now let’s see in more detail what are the pros and cons of each “real money” option to help you choose how to trade.

Pros and cons of the Wallet account

With the wallet account, traders are placing their bets directly from their Ethereum wallet. When you place a trade you sign a transaction equivalent to your stake in your MetaMask account. If you win your trade, the payout is sent back directly to your ETH account. This is therefore the fully decentralized account type of Spectre, the safest of all as your funds never leave your wallet.

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But this method has some disadvantages. It means that for each trade, you have to pay gas and validate a transaction in MetaMask. Given this, the minimum trade is $50, which might be way over the trade size you want to use.

This option is therefore recommended for people trading substantial amounts and who want to have full control over their funds, at any second.

Pros and cons of the Regular account

The regular account addresses the issues inherent to decentralization, mainly the fact that it is not very cost-effective and convenient. With this account type you trade via the Spectre smart contract. You send funds there from any type of wallet (hard wallet, MEW, MetaMask, etc.) to the provided address. Once the transaction is confirmed on the Ethereum network your deposit appears. You can then simply trade, your balance will be adjusted according to your wins and losses. You don’t have to pay gas fees for each trade, this is “free”. You can bet as low as one dollar per binary options trade.

When you want to withdraw your funds you just request your funds and it will be sent as fast as the Ethereum network allows. Nobody will review your withdrawal, the smart contract controls everything. You have to pay gas for any withdrawal. However please note that you have to wait 24 hours to be able to withdraw profits (smart contract security feature).

What are the cons of this option? There is only one: in case of a hack, your funds might be lost. Spectre has of course taken a lot of measures to prevent this. It is extremely unlikely, but the possibility cannot be completely ruled down.

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Pros and cons of the old school wallet

At the moment this option is not available yet, it will be during the course of the summer 2018. The “old school wallet” will allows traders to swipe their credit card to load their Spectre account with USD and trade the same way they do with others binary options brokers. The advantage is that you don’t need to know anything about cryptocurrencies + you get immune to ETH volatility. CASET will allow this easy “fiat deposit” + semi-decentralization option (regular account), but it might be that some traders who know jack about cryptos don’t want to be exposed to ETH volatility.

Cryptos enthusiasts might also prefer this option. The problem is the following : you deposit let’s say $1000, or 1.25 ETH if we assume that Ether is at $800. Then we experience a 24h 20% correction, followed by another down market. In fiat terms your account is down from more than 10% even if you make profits. This is not palatable for everybody. Old school wallet will offer a solution against this risk. The big drawback is, of course, that you are again in a fully centralized set-up. If you fully trust Spectre it might be the way to go. After all, if they propose a fully decentralized option it means that they have set-up the platform in a way that they don’t rely on traders losses to make profits (as a reminder Spectre profitability model consists in taking a trade fee). But it goes a bit against the spirit, let’s be honest.

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Spectre: what account to choose? My view

You might still be confused about what to choose. Here is my opinion. I don’t think the fully decentralized wallet (Wallet mainnet) is very convenient, unless you trade $100 or even much more on each put or call. For short expiries it is not convenient at all since you have to sign the transaction in MetaMask, which means your timing is more complicated to execute.

I really like the Regular one, this is what I use. But then there is this Ether volatility, that I find annoying. Cryptos bulls will argue that short-term volatility is not an issue, that long-term Ether will appreciate. Probably, but still, my bills are in fiat. If I need money this is an issue.

The solution would therefore be the old school wallet? I like the fact that I can trade in USD, but then we are back in the centralized world, which goes against the initial idea. I trust Spectre, but I would prefer not having to and rely on the safety of smart contracts.

Right now there is, in my opinion, no perfect solution. The ideal one would be the actual semi-decentralized or decentralized wallet based on a stable coin. Old-school wallet is not out yet. Once it is I’m still not sure what I will choose. I might stick with Ethereum and accept the volatility until a stable coin is made available (which hopefully will be the case once a stable coin proves it can stand the test of time, or show audits, something that Tether (USDT) has failed to do so far).

Whatever your choice is, one thing is certain: you will be much better off with Spectre than with any 100% centralized binary option broker. You can register here if not done already.