I have built a Bitcoin **trading system** that can trade with several accounts on **centralized exchanges**. The system is designed to trade BTC, simultanously with all accounts, according to signal it receives at periodic intervals (every day).
The performance of the system is solid and I would like to display live trading, historical performance and statistics in a website, and give visitors the possibility to copy-trade this strategy.
**My plan is to issue a proprietary ERC20 token that will grant access to the copy-trade service.**
For example, a user with a Binance/FTX account worth $10’000 that want to benefit from the service will be required to stake 10’000 of the company’s proprietary tokens. If the account is worth only $1’000, then 1’000 tokens will need to be staked, and so one. There will always be a 1:1 ratio between the amount of token staked in the user wallet and the dollar value of the account under management (AUM).
I’m looking for advices on the tokenomic design. Do not hezitate to contact me in private if you think you can bring something valuable for this project.
* Demand for the token will increase as the system will make profits, because users will need to stake more tokens as their account growths. Historical performance of the system is around 130% profit per year in average, very stable, no leverage, low volatility, so my assumption is that the token supply should grow in the same magnitude. Thought ?
* But supply should also allow new participants to be onboarded, not creating a barrier or bottleneck. This is more difficult to anticipate.
* How to distribute the token to users ? I think tokens could be distributed with a liquidity pool that will act as an automated market maker (AMM) like Uniswap. Sor for example, if I can bring $100’000 worth of ETH in the pool with 10’000’000 tokens in counterparty, the cost per token will be $0.01. So the cost of copy-trading and account of $10’000 will be $100, which is a very decent price that only firstcomers will pay. Price per token will increase as more tokens are withdrawn from the pool and staked.
* Tokens could also be lent. The company that will issue to token will own 20% or 30% of the total supply, and instead of selling chunk of these tokens to customers it will lend tokens to users for a fixed period of time. Let says for a duration of 30 days, so that users periodically renew the loan contract and pay interest according to market demand.
* One idea I had, is that the number of accounts under management could be limited to few hundred (to be defined), depending on the system infrastructure and API rate limits at the exchanges side. For example, as soon as the number of accounts under management reaches 500, the account with the lowest amount of staked tokens loses access to the copy-trade service. Another advantage of this operation is also to increase the cost for an attacker to capture the signal with a small account and use it in the background for a large account.
**Guys, I would love to hear your thoughts**
* how to determine the optimized token supply ?
* what is the best distribution mechanism to implement ?
* interest of a token burn of any sort ? not sure IMHO
* interest of redirecting a portion of inflation to staking rewards ?
Feel free to share your thoughts in the comment section,