SWAP service description
SWAP service description
SWAP is an additional MINEX WEB WALLET service enabling its users to sell their BTC funds for fiat money enjoying the opportunity of minimizing future exchange rate losses in the case of its changes.
How does it work?
This is for a customer wishing to spend immediately fiat money in exchange for his BTC funds, who at the same time is not going to sell BTC because of exchange rate raising expectations.
In that case, the customer orders BTC SWAP inside his MINEXPAY WALLET account; that means that a COMPANY writes off his funds e.g. 1 BTC (as a collateral) from account and tops up his card for 75% of current exchange rate of 1 BTC. For example, if a current rate of 1 BTC = 4000 EUR, the client gets 3000 EUR just when he orders SWAP and it is approved (SWAP has to be approved if there are enough BTC funds on user’s balance and all the details are correct). On the expiration date or before, COMPANY has to return collateral (1 BTC) minus already paid funds to owner’s MINEXPAY WALLET account, according to closing date exchanging rate.
Then several events are possible when SWAP is closing:
1) On SWAP expiration date the BTC exchange rate rises (1 BTC = 5000 EUR): internal algorithm of MINEX WEB WALLET is to return 2000 EUR calculated as the difference between exchange rate on expiration date (1 BTC = 5000 EUR) and actually paid amount (3000 EUR).
2) On SWAP expiration date the BTC exchange rate is the same as it was on SWAP setup date (1 BTC = 4000 EUR): internal algorithm of MINEX WEB WALLET is to return 1000 EUR calculated as the difference between exchange rate on expiration date (1 BTC = 4000 EUR) and actually paid amount (3000 EUR).
3) On SWAP expiration date BTC exchange rate reduces by 25% or less (1 BTC = 3000 EUR): nothing is to be paid because the value of collateral is equal or lower than the amount already paid; in that case, the COMPANY’s obligations are deemed to be completed in full without repayment.
SWAP may be used for different periods (min. for 30 days) with varying commission rates subject to SWAP period. Initially, SWAP will be available for MINEX WEB WALLET users who have already connected their MINEXPAY cards to the wallet, but the COMPANY is going to make its SWAP service available to any other users (after passing KYC/AML/CFT verification) holding any payment cards/accounts of any Bank.
*SWAP expiration date by default is the ending date of SWAP period; however, the customers may call for repayment at any other date according to their preferences, free of any extra or hidden fees or penalties.