How Trading Works – Part 2
Applied concepts for teams integrating stablecoin ↔ Bitcoin trading into real products.
Understanding Price Formation
Bitnob’s rate field in a quote or trade response isn’t just a random number. It reflects:
Live pricing across exchanges and OTC desks
Routing logic optimized for speed, reliability, and capital efficiency
A protective margin buffer (optional based on your tier or configuration)
This is why quotes should be treated as the truth for pricing, not reconstructed or guessed.
If you're showing a price to a user, always fetch a live quote — and don’t cache it beyond the expiresAt.
Market Rate vs. Locked Quotes
You can trade two ways:
| Type | Behavior |
|---|---|
| Market rate | You call POST /trades/execute without a quoteId. You get the best current rate. |
| Locked quote | You first fetch a quote, store quoteId, and call execute using it. |
When to use locked quotes:
You’re showing a rate to a user in a UI
You need to comply with a regulated or fixed-price promise
You’re waiting on user confirmation before executing
Pro tip: lock the quote, show a “valid for 30 seconds” countdown, and auto-expire the CTA to avoid expired trades.
Asset Precision and Units
Don’t confuse this. Bitnob expects:
| Asset | Input Unit | Example |
|---|---|---|
| USDT | Cents | 10000 = $100.00 |
| Bitcoin | Satoshis | 100000 = 0.001 BTC |
Tips:
Always convert frontend floats to integers before sending to the API
Never let users input commas, decimals, or non-numeric characters into amount fields unless you're formatting and stripping them internally
Rate = Output / Input
Bitnob returns a field like:
"rate": 2250
What does this mean?
It means: for every 1 unit of input, you get 2,250 units of output.
Example:
from = usdt, to = bitcoin
amount = 10000 (i.e., $100)
outputAmount = 225000 (i.e., 225,000 sats)
rate = 2250 (sats per cent)
This means: 1 cent = 2,250 sats Or: $100 = 225,000 sats
This helps with building analytics, charting rates over time, or explaining conversion math to your users.
When to Show Fees
Bitnob charges no fees by default. But in the future or for enterprise customers, you may receive:
"fee": 80
This will always be in the same unit as the input (e.g., cents or sats).
Best practice:
You’re converting: $100
Fee: $0.80
You’ll receive: 224,200 sats
Effective rate: 2,242 sats per cent
Show this clearly when users are exposed to fees. Hide it if you absorb them.
Execution Timing and Flow Guarantees
If quote is locked, execution is atomic + final
If quote is expired: API will fail cleanly — you never get an unintended trade
No partial fills, no unexpected rate drift
All trades result in immediate balance updates in the destination wallet
trade.completed webhooks confirm state — this should trigger your downstream logic
What You Don’t Have to Worry About
Order books
Market slippage
Routing to Binance, Kraken, OTC desks
Gas fees for wrapping/unwrapping BTC
Reversibility, cancellations, or hold periods
Bitnob shields you from all of it.
You just:
Quote
Execute
Confirm
Settle
Real-World Example: End User Sell Flow
User has 100,000 sats in their Bitnob wallet. They want to cash out into stablecoin.
You do:
GET /trades/quote?from=bitcoin&to=usdt&amount=100000
Display: “You’ll receive $45.12”
Lock quote, wait for user approval
POST /trades/execute with reference, quoteId
On webhook trade.completed, show: “Success. $45.12 credited to your wallet.”
Internal ledger updates balance
Optionally trigger payout to bank/mobile money via stablecoin off-ramp
