CoTrader: A blockchain platform for smart investment funds

bonanza-kreep (66)in #cotrader • 6 years ago

Cryptocurrency trading and investment is becoming more complex every day. It is practically a full-time job that requires constant attention and expert knowledge that most of those who engage in it cannot bring to bear. You can still get lucky and make the right investments at the right time, but it is far easier to end up wasting your money on scams, failures and poorly-timed trades. That is a pity, especially considering how very lucrative the cryptocurrency market has become for those who do know how to play it.

https://cotrader.com/

The obvious solution is that borrowed from the world of traditional finance. Investment funds allow those who want to get rich off trading without spending all their time on mastering it to hire others to do that for them. But the trading infrastructure for the cryptoindustry is still at a rather primitive stage. Besides that, even well-established investment funds can prove dangerously unreliable and opaque. Trusting someone with your money in a new and volatile market is an understandably dubious proposition.

CoTrader plans to circumvent those and other problems by creating a decentralised infrastructure for investment funds. By using smart contracts, it hopes to safeguard the interests of both investors and fund managers and enable a more reliable form of investment in both cryptocurrencies and other forms of assets.

How can you use CoTrader?

CoTrader's platform will be accessible through a website or a mobile app. For a one-time gas fee, anyone will be able to become a fund manager by setting up an investment fund powered by smart contracts, setting a name and a performance fee tied to a percentage of the overall profits. The greater part of the performance fee will go to the manager, while the rest will go to the platform. Investing in a particular fund will be done by acquiring shares with COT tokens. It is expected that the manager will invest in the fund and start trading with that sum at first, while others would be able to jump in at any point. With the help of smart contracts, the manager will be able to share the fund's ROI while hiding or revealing the strategies used at their own discretion. Investors will be able to deposit or withdraw COT at will, with the fund minting or burning new shares respectively. The performance fee will be subtracted from the amount withdrawn. Since the shares themselves are going to be tokenised, it will also be possible to transfer them seamlessly to other wallets.

https://cotrader.com/

Trading will be done in a number of different ways. The default option may be said to be trading on specially vetted and integrated decentralised exchanges (DEXes), which will also be used to determine the value of a fund based on the current market price of all the tokens that it holds. New DEXes will be made available over time, each addition being implemented with a 30 day grace period before any trades can be made on them. Smart funds will be able to trade in Ethereum and all ERC20-based cryptocurrencies from the start, but eventually CoTrader hopes to cover all sorts of assets, including stock options and derivatives. It will facilitate trading on trusted centralised exchanges by means of a smart escrow system. Any sort of assets could be given token representations on a master account, making it possible to track them. Money set aside for trading will be released from escrow once the purchased assets are transferred to the fund. There will also be a form of investment fund that will focus exclusively on ICOs and be eligible for group discounts, streamlining investment.

Later on, more complex features will be added to the platform. CoTrader will set up its own DEX for smart fund shares, presenting all available information on the funds involved. This will also enable a form of ICO futures trading, since shares in ICO funds could be traded before the ICOs themselves are finished. More advanced options will become available during fund creation, such as minimum and maximum deposits. CoTrader also plans to create a trading tools marketplace. The platform team will provide the initial basic tools, but later on third-party developers are expected to contribute more advanced analytical and signal applications. Paying with COT on the market will provide discounts.

What advantages does CoTrader have to offer?

The platform's design advances the interests of both sets of stakeholders. Fund managers will be able to keep the secrets of their success to themselves while still proving their general competence and trustworthiness through a clever use of smart contracts. Investors will be protected by CoTrader's vetting of all supported exchanges and by their own ability to easily invest and withdraw money. This combination of trust and convenience should lead to a welcome boost to trading, delivering reliable profits to everyone involved. CoTrader's planned expansion to other assets and forms of trading should provide its participants with much-needed flexibility and liquidity.

CoTrader is being worked on by a team of cryptoindustry veterans who are very familiar with the field. Its founder has developed an innovative protocol based on zk-SNARKs to ensure simultaneous fund manager anonymity and accountability. The company has already secured the cooperation of three DEXes: Bancor, Kyber and OX. The initial version of CoTrader is already undergoing live beta testing and will be refined further after it concludes. Platform profits will go towards buying back and burning COT to maintain its value in the long run.

Token sale details

The ICO for the Ethereum-based COT token will take place over the course of August 2018.

Potential breakthrough for cryptocurrency trading

As the cryptocurrency market continues to mature, the trading services that sprung up around it struggle to keep up with the developing demand. This is perhaps not so much a matter of quantity (though the volume of trades poses its own challenges) as of quality. Investment must become both more accessible and more reliable for the market to continue its growth, as otherwise its hazards would drive potential participants away. Also, solutions for the industry's trust and liquidity problems must be provided.

CoTrader seems like a very promising project from this perspective. Its main promise is that of using smart contracts to help both investors and fund managers in a way that would have been impossible before. Beyond that, it offers its services as a facilitator and a verifier to help create new opportunities for investment by adding new trusted exchanges and ICOs and making investments in traditional assets as safe as those done by smart contracts. It is not the only cryptocurrency investment fund project, though it may be the most technically inventive one. However, the CoTrader platform's ultimate success depends on two factors: the acceptance of its expertise by would-be investors and the quality of fund managers it attracts. Its beta test, as well as the buzz that it attracts within the industry, could prove crucial in that regard.