Bernd Stöckl joins us to discuss on Trading Decentralized Perpetuals at 10x Leverage with Palmswap.
Bernd Stöckl is the CPO and co-founder of Palmswap, a decentralized perpetual contract trading protocol that aims to become the next-generation perpetual DEX for cryptocurrency markets.
Want more resources around this podcast? Keep up to date on the latest articles here.
The following transcript was created using artificial intelligence. There will be some grammatical errors below.
00:00:17:21 – 00:00:35:06
Richard Carthon: Hello everyone. Welcome to another episode of Crypto Currant, your host here, Richard Carthon. Today I’ve got a very special guest all the way out in Dubai working on a really, really cool project called Palm Swap, which is working with Perpetual Decentralized. Today we have Bernd with the CPO at Palm Swap. How are you doing today?
00:00:36:02 – 00:00:38:03
Bernd Stöckl: Hey man, pleasure to be here. I’m great.
00:00:39:06 – 00:00:46:10
Richard Carthon: All excited to learn more about you and everything that you have going on with Bomb Squad. But before we do, let’s learn a little bit more about you. Can you give us some background on yourself?
00:00:47:00 – 00:01:22:28
Bernd Stöckl: Yeah, sure. So you already said it, right? I’m based in Dubai. I’m originally from Austria. I’m 27 years young. I started my journey in crypto around seven years ago. And in 2015, when I first time with Bitcoin, it was August around like $220. So I guess I was quite, quite early and lucky in that space to get introduced to it. That’s that early. And yeah, I’ve invested into a lot of projects and through all the time benefited a lot from the whole ICO boom in 2017, survived the bear markets into 18 to 19.
00:01:23:10 – 00:02:00:09
Bernd Stöckl: And yeah, we had a, a soft company basically, and the perpetual trading space. We started perpetual trading when it was introduced 2017 by BitMEX. I guess that’s a term for most of the people. And we had a trader like a copy trading company sort of like this, or we API on BitMEX like this. We got like a lot of experience and perpetual trading and leverage trading for say and started in working on Palm Swap basically in 2021, which is like a decentralized exchange for derivative trading.
00:02:00:21 – 00:02:07:10
Bernd Stöckl: And yeah, super, super exciting actually. And I think it’s a it’s a really good product and at the right point in time as well.
00:02:07:29 – 00:02:38:19
Richard Carthon: Yeah, it’s really interesting and definitely excited to it’s more into the especially the perpetual side of it. But before we do that, you know, it’s awesome journey and you’ve been in this space long enough. You got into Bitcoin super early before it was even $2,000, which is awesome. You’ve seen ups and downs, so this isn’t your first bear market, so you know what to anticipate and how to build in it. But for those right now, first to get some basic understanding. For those who don’t know, can you give like a brief description of what our perpetual.
00:02:39:27 – 00:03:23:03
Bernd Stöckl: Sure. So basically, it is very, very similar to a future contract, right? That means like you can trade a currency pair like, for example, Bitcoin with the US dollar, right? Or USD right. And you can long or short this asset, right? That means you can bet that this asset is going to go up or is going to go down. Right. And if you’re right, you’re making money basically. And the cool thing here is you can use a leverage, which is kind of like you’re borrowing funds, right? So you can trade for more money that you actually have deposited on the platform means you could as well make more gains on your trade, but as well, your trade can get liquidated fast.
00:03:23:05 – 00:03:56:18
Bernd Stöckl: It means the higher the leverage, the higher the risk as well. I personally always suggest to use a lower leverage. Right. But yeah, you everybody takes its own risk I guess, in trading. And the cool thing with perpetual contract is they are not expiring or future quantities expiring after three months. Right. And the perpetual contract is unlimited, basically. Right. And BitMEX introduced it in 2017 as a guess, the first exchange in the crypto space, because before it wasn’t really possible to short bitcoin.
00:03:56:22 – 00:04:08:12
Bernd Stöckl: Right? And ever since then it was made possible. And now we are bringing that not as the first one spot. We have a couple of unique perks that you only have on centralized exchanges so far.
00:04:09:02 – 00:04:25:12
Richard Carthon: Right. And thanks for that background. And the reason I wanted to bring that up is typically you can only do leverage trading on in centralized exchanges. Yes, but this is a DEX is a decentralized exchange. How are you all able to bring perpetual and leverage trading to a decentralized exchange?
00:04:26:05 – 00:04:57:27
Bernd Stöckl: So basically, we’re not the first ones who we’re doing that right? Like there is a couple of hybrid indexes outside. There has one two protocols that already launched a perpetual dexs. But in general, and maybe this is also good to cover, we saw that there is a market cap, right? We saw that in 2020, 2021, a lot of volume was coming from the centralized exchanges over to the decentralized exchanges, right. Like Pancakeswap, Uniswap, Sushiswap, and so on. It was all spot trading. But when you look at derivative trading.
00:04:59:00 – 00:05:41:20
Bernd Stöckl: Pretty much nobody is doing it yet. Right. And that’s what we saw last year and that’s why we started working on top Spot, because we saw there is a gap in the market and derivative trading is the biggest market out there. Right. And yeah, that that is the basically the whole background on how we started. The first protocol that we looked at was perpetual protocol, right? And they started already last year. But we saw, for example, that the slippage, for example, there was high there was limit orders missing stock losses take profits, which is all essentials to basically trade perpetual is nobody should do that without these basic tools, basically.
00:05:43:18 – 00:06:09:03
Bernd Stöckl: Yeah. And the other ex was just not that great. And so we said, okay, we see there is a market, it is working because we have already seen other projects doing it and proving the market. And we just said, okay, let’s just focus on the things that are not there yet. And that’s what we’ve built basically a decentralized exchange for derivative trading where you have all these order types that you have on centralized exchanges as well.
00:06:09:26 – 00:06:48:13
Richard Carthon: Right. And I think those are some very crucial points that I just want to go back to really fast. So with spot trading, if you’ve ever used some of your regular dexs out there, whether it’s Uniswap, Pancakeswap, etc., you’re swapping and you’re trying to get the spot, the exact amount in that moment. But if you’re doing futures, you’re trying to say like, Hey, I want this future price right now. ET cetera. You have a couple of different ways that you can now trade and get that. However, as Bernie said earlier, you are exposing risk and the reason why you need to be able to do stop losses and take profits and everything else is because sometimes there are huge moves in the market.
00:06:49:01 – 00:07:21:07
Richard Carthon: Recently there’s like a 10% move in the market. And so if it jumps over a threshold that you just put in place and then goes down back below it and it didn’t hit your your mark, you potentially just lost all your money or you potentially didn’t take the profit on what you saw on your target that you were looking for and like that. That is extremely frustrating. And yes, these are a little bit more advanced trading topics, but these are things that people look for and towards during bearish times when the volatility isn’t as much as a lot of a lot of the market’s been moving flat for the last several months.
00:07:21:09 – 00:07:31:03
Richard Carthon: So people start looking at leverage trading and other things right now because of while we’re in these levels of resistance and.
00:07:32:24 – 00:07:53:21
Richard Carthon: Looking at like these these new places where the market is trying to move to, it allows for people to have a really good understanding, an idea if we’re only going to be staying in between these two prices, you can now leverage up and still de-risk in some capacity. So I’m sure Palm Swap is very sought after right now in this moment.
00:07:55:01 – 00:08:29:20
Bernd Stöckl: Yeah, for sure. I mean, I think the most important point is when you’re building a product is that the product can be used in a will market, but more importantly as well in the bear market. Right. And that’s why we also decided to launch already. Now, is the market environment perfect? For sure. It’s not right. But the most important thing from our end was now is the time where we can build our customer base. Basically, now is the time we’re building the fundament to then basically benefit massively together with the community in the next upcoming bull run.
00:08:29:26 – 00:08:44:01
Bernd Stöckl: And that’s why we also decided to already roll out now because the product is ready. We launched yesterday a hybrid Dex with order book and a nice cooperation as well that we managed to do pull on board over and over the last weeks. So, yeah.
00:08:44:28 – 00:08:55:25
Richard Carthon: Well, congratulations on the launch. And I know that, you know, you’ve had plenty of people testing it out and now starting to use it. How has the initial experience for those users been so far?
00:08:56:29 – 00:09:26:28
Bernd Stöckl: I think it has been good. I mean, we are still with the 100% launch index. We just because we are we are offering two kinds of models. We still in the testnet and going life for the alpha test is on the mainland and. Three weeks, four weeks from now. And. But yeah, so far the feedback has been really, really good. And yeah, the people were anticipating it heavily. So I think it just speaks for itself that a product like that as well was it was really appreciated in the market.
00:09:27:23 – 00:09:43:05
Richard Carthon: So if someone is trying to potentially use this and try to do some of their either first leverage trading perpetual calls or just learn more information. Of course everyone can go to Palm Swap dot org. But what are some of those like first steps people can take to like, utilize this new Dex?
00:09:45:00 – 00:10:27:29
Bernd Stöckl: You mean how to get started? Yeah. Yeah. It’s actually very, very simple, right? I mean, the cool thing about Defi is, is decentralized. It means you don’t need to register an account, KYC, whatever, whatever, whatever. You just connect your metamask wallet, for example, and you deposit your your stablecoin on the wall and onto your next. It’s going to be used right now on hybrid. It can also as well be used to see or view Estie island chain and then you’re basically ready to go, right? And everything else works pretty, pretty similar, like on a centralized exchange, just on the 100% on chain.
00:10:28:01 – 00:10:40:18
Bernd Stöckl: All the transactions have to be confirmed with PMD. So you need a little bit of BNB on your METAMASK as well to confirm the transactions identity symbol. I want to see basically.
00:10:40:28 – 00:10:58:20
Richard Carthon: Yeah, very simple. They’re going on this. And, you know, I see on the roadmap that you’re one of the reasons why you would potentially also want the native token through governance is that being able to vote for future pairs. What are some things on the roadmap that people can look forward to on for for partner swap?
00:11:00:09 – 00:11:13:01
Bernd Stöckl: A lot, honestly. Like as I said already the hundreds and in launching model launching next month. Just one second I need to check my laptop too quickly because otherwise I’m running out of juice.
00:11:14:21 – 00:11:15:06
Bernd Stöckl: Oh,
00:11:17:02 – 00:11:36:04
Bernd Stöckl: so on chain launch next month, then next. Then in the next year, Q1, we want to already be cross-chain compatible. That’s what’s on the roadmap as well. And we would like to integrate a sort of like a decentralized we call it decentralized hedge funds, but it’s like a decentralized as a financial platform where.
00:11:37:20 – 00:12:09:15
Bernd Stöckl: I kind of like a more extensive version of a copy trading model where traders as well can get a performance fee and so on and so on. But all defi rights of users keep their funds right? So it is the next big things that we are working on right now. And as you spoke about the native token, of course, there will be probably as well further further features that we will implement into the token. The most important things, I think is like the token actually has utility, right? And you have great everyone once.
00:12:09:17 – 00:12:10:21
Bernd Stöckl: And so yeah.
00:12:12:06 – 00:12:46:11
Richard Carthon: Well sounds like you got a lot on in the pipeline, but that is some pretty exciting stuff for for Palm Swap. But you know I know that you’re pretty passionate about the overall like Defi space and. There’s Defi summer of 2020. Since there has been quite a few unfortunate platforms that have had some cascading effects as we look at, you know, what happened with Celsius Voyager and most recently Freeway, how do you think the defi space will continue to evolve over time?
00:12:48:23 – 00:13:16:24
Bernd Stöckl: I mean, you know, when when these kind of events happen, it’s always terrible, right? I mean, because it kind of like damage is always a bit of trust and that will defy sector wide. I hope that these things will improve. Obviously, I mean, I think you can never be 100% secure off of hacking attacks or some of this when you look at Binance and so on. But of course, other business models where whatever funds are taken and then invest into something else.
00:13:18:23 – 00:13:27:12
Bernd Stöckl: For these kind of things should be a bit more regulated. You know, in my opinion. So, yeah, that’s that’s my my take on that.
00:13:28:03 – 00:13:58:23
Richard Carthon: Yeah. And I think regulation will continue to come in, especially as it relates to these centralized exchanges, trying to use a defi platform or defi protocol of sorts. Because ultimately people who think they are putting their funds somewhere and it’s the centralized etc., and that they can get it back and they can’t because it’s really under underneath a centralized platform. I think that’s where the regulation really needs to start coming in because like.
00:13:58:26 – 00:14:39:28
Bernd Stöckl: Using it, if you like it using it right, and it just it just goes in the wrong direction. When we talk about regulations as well, I believe and this will take time, right? I mean, we already seeing that a couple of jurisdictions are coming with very, very good and smart crypto regulations. Right. Because they understand the subject crypto. But as a matter of fact, you cannot, for example, regulate Defi like a centralized exchange, for example. It wouldn’t make any sense, right? So I believe it will it will take a bit of time until the proper regulations are there and it really are beneficial as well for for the whole space.
00:14:41:12 – 00:15:12:26
Richard Carthon: I agree. And I think we’re starting to go in the right direction with getting some more of that regulation. And unfortunately, before you get some of that regulation, you have to have some pain. And there’s been plenty of it this year. But I do think for the builders, it is making them challenge their. Not just beliefs or how things are being set up, but also like how can they genuinely protect their end user? Because now users are coming in with this knowledge of like, Hey, we’ve seen this happen in other places.
00:15:12:28 – 00:15:29:03
Richard Carthon: What are you going to do about it? What are you making sure to make sure that this doesn’t happen on your platform? And I like that newfound, like accountability for people who still are bullish on Defi because it defi the thought around I think did take a hit. But I still think Defi is one of the largest opportunities in the space.
00:15:29:15 – 00:15:52:29
Bernd Stöckl: For sure. For sure. I mean, especially for startups, you know like I think it’s an amazing it’s an amazing ecosystem and has evolved in just like the past 2 to 4 years, right? And being in crypto for over seven years, I think Defi is, was like a very, very evolutionary step in crypto. And I think it brought a lot of opportunities as well with it.
00:15:53:18 – 00:16:21:12
Richard Carthon: Yeah. And I think it will continue to do so. But as you. So coming from someone who has as much experience in this space, I always like to ask a couple of fun questions and one of them I typically bring up for people especially have been through bear markets before. How would you say this bear market is similar, are different from previous bear markets? Like is are things starting to rhyme, repeat, or is this completely different? Like, how how are you kind of seeing it?
00:16:23:11 – 00:17:02:19
Bernd Stöckl: I mean, I think that definitely the the bull markets and bear markets are not the same like they were like five years ago. Right. Or three or four years ago because the market is a lot more evolved. Right? It was it was a lot less involved in 2017. Right. And I think it evolved a lot over the last years. And that was very, very good. But, of course, you know, in every bull market, you have these people that are very, very overoptimistic. And I was last year in F1 and Abu Dhabi in December, and I spoke to so many people and everybody was telling me, Oh, Bitcoin is going to go 200,000 minimum, and then we’re going to go bearish.
00:17:03:04 – 00:17:32:01
Bernd Stöckl: And I was speaking to my friends that actually know at the time we should sell everything because like I mean, everybody’s that bullish and this is the time when you can sell. I didn’t sell in December, but I saw in January a portion of my portfolio and it was definitely the right decision. And yeah, to be very to be very honest, I think that this bear market is also a lot different than the one before, because when you look at the whole global economic situation right now, being in a recession right now.
00:17:33:25 – 00:18:08:06
Bernd Stöckl: We will see how much more of an impact it’s going to have on crypto and when the cycle is going to change. I don’t believe it’s going to be this year for sure, and I don’t even think it might be next year, maybe the year after 224. But let’s see, right in the end of the day, nobody has a glass ball. I don’t really like to predict markets and so on, but for now, I’m very careful when to deploy capital and I personally have not yet bought in big chunks.
00:18:08:08 – 00:18:10:01
Bernd Stöckl: I do some DCA, but.
00:18:11:16 – 00:18:39:04
Bernd Stöckl: I’m very, very holding back still. So that’s just my intake. Maybe I’m right, maybe I’m wrong. We will see. But I do believe that we could definitely see the bear market go a bit longer. And what I also still feel and this is really now a comparison to 2018 where we saw Bitcoin going to $3,000 and I did not cash out back then and it was very painful to spend Bitcoin on 3000 knowing that it’s going to go back up again, right?
00:18:40:24 – 00:18:51:02
Bernd Stöckl: I don’t think at this maximum level of pain is reached yet in the current bear market, and that’s why I do believe that we might still see lower levels on bitcoin as well for other assets.
00:18:51:19 – 00:19:35:12
Richard Carthon: Yeah. Thank you for sharing your take on that. And of course, everyone, none of this ever financial advisor, any of this, this is all our own opinion. And I tend to agree with you that I don’t think we’ve seen max pain yet. I think the worst is yet to come. And I think we potentially could be in an extended bear purely because of the macro that’s going on. I think with the global markets between recessions, inflation and the energy crisis that we’re about to hit this winter on top of global economies having to have to pull back, there’s going to be more people probably getting unemployed as people start to make their projections for 2023 and trying to, you know, become profitable again and also prepare for potential bearish times.
00:19:35:16 – 00:19:53:21
Richard Carthon: And that has impacts on a lot of different things. And right now, because crypto is still as correlated as it is to the regular markets, the true decoupling hasn’t happened yet. I think eventually will, but we’re not there yet. And so because of that, I do think we’re going to see some more bearish times for a while as well. So.
00:19:54:09 – 00:20:18:09
Bernd Stöckl: Yeah, and and I believe no asset class is going to be excluded from that because people sometimes say, oh, you know, Bitcoin is like the inflation hatch or something like this, but this is just it. So far, this has not been proven correctly. Don’t get me wrong, I’m a massive Bitcoin bull, actually, and I’m a Bitcoin maximalist because it was the first thing that I have invested in, but still.
00:20:20:11 – 00:20:37:20
Bernd Stöckl: I just see that the whole economy as it is and I don’t see the reason why crypto would be excluded from debt. If stocks are plummeting in real estate and whatever else. Crypto is going to be affected as well, and it has already been. So.
00:20:38:09 – 00:21:08:10
Richard Carthon: Yeah. Yeah, I think I think all everything will be affected for for sure. And that’s why it’s important for people to be learning about different opportunities, ways that they can still potentially make profits even when things are going bearish. And to always make sure you have a little huddle bag on the side just for for the long term as well. But another question I’d like to ask is, with all the information you have right now, if you go impart one or two pieces of wisdom to yourself, when you first got started, what would you tell yourself?
00:21:11:17 – 00:21:43:01
Bernd Stöckl: I wish I would have had more capital back then because to be very honest, I didn’t understand Bitcoin and 215 when I invest into it, I literally I took the risk, you know, of course, of all the information I would have now, I would have probably bought more and I would have probably sold in 2017. But yeah, I mean, I already again, I think I already from the story that I just explained, I already learned because I didn’t cash out in 270 when that was the time when I got total cash out.
00:21:43:13 – 00:22:14:24
Bernd Stöckl: This time I took the position and I think the most important thing is not to be emotional, right? Because I just feel I don’t know why it is, but in crypto we just like so holding on to our bitcoin and so on. But a profit that you are not taking is a profit. Not me as well, right? It doesn’t make sense if you have millions on paper, but if you never realize a profit it is never a profit. The same goes for a loss, right? You don’t want to if you bought your your E for whatever to expenses meant, just hold on to it and wait until it goes up.
00:22:15:05 – 00:22:15:20
Bernd Stöckl: Right.
00:22:17:01 – 00:22:29:04
Bernd Stöckl: But yeah, I think taking profits is something that is and is very, very important and that’s definitely something I wish I would have learned a bit earlier. But yeah, that’s maybe something that I would like to share.
00:22:29:21 – 00:23:04:19
Richard Carthon: I think those are two great lessons. I know that Pre said as well as that like taking profits are not a bad thing. Like yes there’s always like there’s there’s buyer’s remorse and seller’s remorse right where you you decide to sell after you are potentially in a loss and then it goes back up and you’re like, man, I wish I could’ve held on. And then there’s points also at the top where you, you know, was like, oh, I bought this year, I could make more money, and then it goes up further or it goes down and you’re like, Okay, well, which one are you going to feel worse about? It’s it it’s always like when you lose money. So taking some profit off the table, have an exit strategy, have some things in mind for that.
00:23:04:21 – 00:23:34:22
Richard Carthon: And, you know, you walk away and you feel good about it. But I’d also say a lesson that I also want to echo besides taking profit, is also just being patient with when things go down. Because if you have to, when you’re looking at your crypto investments of like you have to survive on that money and you then you have to sell it to like pay for expenses or whatever it is, it hurts because, you know, like if I just give this time, it’ll at least recover.
00:23:34:28 – 00:24:01:19
Richard Carthon: Maybe not all the way and maybe still become profitable. But if you gives things time, historically with time, you succeed. But when these moments happen and money gets tight and you have to start digging into your crypto investments and you have to actualize those losses, that hurts big time. So yeah, I guess something I just want to echo is for your crypto hodl portfolio. Let that be the hodl and don’t touch it if you can. If you can, don’t touch it.
00:24:02:21 – 00:24:37:20
Bernd Stöckl: Yeah, for sure. And that that is always the reason of Hodling right? Like you don’t want to sell it. Right. And that’s. This is probably what you should do. And actually and this is an advice that I can give that always done. You know, I’m not coming from a rich family and I haven’t had capital like seven years ago when I started crypto. But through earning money and increasing cash flow, this is the best thing that you can do right now, because right now it’s cheap. So let’s say if you’re making a $10,000 right now and you’re investing now and you like fusion or Bitcoin whatsoever.
00:24:38:22 – 00:25:06:23
Bernd Stöckl: The upside potential that you are having is, of course, massive. Right. And I think this is the most important thing I’m focusing on right now. I personally, I did not become rich by just investing in the crypto, but I really like I build up wealth by creating cash flow and investing that cash flow, basically. And this is the leverage that you can take basically for your own portfolio without using leverage trading for sure.
00:25:07:08 – 00:25:19:28
Richard Carthon: And I mean all of that in absolute gems, and I definitely appreciate that. And you’ve given everyone here a lot to think about and especially want to make sure that everyone goes checks out. Palm Swap before we wrap up with a final thought that you want to leave with all the listeners here today.
00:25:21:18 – 00:25:50:11
Bernd Stöckl: I believe if you believe in the future of decentralized trading and so on, then you should definitely check out our our platform. And if there’s any more questions, feel free to jump into our community chats. We have a lot of moderators still happy to help with the questions and yeah, everything else. I’ll leave it up to you and lets you do so. Yeah, I believe we have a phenomenal product. Check it out yourself and if you like it, feel free to use it.
00:25:51:11 – 00:26:05:06
Richard Carthon: Excellent. Well, as we remind everyone, if you go to Palm Swap dot org, you can learn more information. You can follow them on Discord, Medium, Twitter and Telegram. And for people who want to connect personally with you, what are ways they can do that?
00:26:07:03 – 00:26:28:14
Bernd Stöckl: Um, personally, I guess the best way is telegram. If you are open for partnerships because my I’m one of the co-founders and I take care of all the partnerships, basically. And if you believe we can partner up on something, feel free to reach out to one of our admins and they’re going to get you in touch with me directly.
00:26:29:17 – 00:26:37:24
Richard Carthon: Perfect. Well, thank you again for all the information. This has been a really great conversation and of course, for everyone listening, stay cryptocurrency.
00:26:39:01 – 00:27:02:17
Richard Carthon: Thank you for joining us for another episode of cryptocurrency. Cryptocurrency is a cryptocurrency and blockchain education platform, bridging the gap between curious newcomers for just discovering the space and the thought leaders for shaping its future. All opinions expressed by Richard Carthon, the cryptocurrency team and their guests on this show are exclusively their own opinions on this show and any other crypto print production is exclusively for informational purposes.
Crypto Current will be guiding all of you who are new to the cryptocurrency world to becoming a cryptocurrency and blockchain expert. Crypto Current was founded to give access to information to everyone on current events occurring in cryptocurrency and blockchain in a digestible way. Since its creation, we have created content that impacted thousands of people through its podcast, blog, and social media.