HedgeTrade, a social platform where traders are paid to share their knowledge and ideas, recently launched.
David Waslen, the company's CEO and co-founder, spoke with Benzinga about the platform's prospects.
What Is HedgeTrade?
HedgeTrade is a blockchain-based social platform born out of a desire to monetize trade ideas.
Co-founder Peter Danihel, a trader and computer programmer, was doing some trading and getting into the crypto space, Waslen said.
Danihel was doing so well with his trading that others considered paying him for his ideas, Waslen said.
The two executed on the idea to develop a website for posting trade predictions, he said.
“It started kind of organically.”
HedgeTrade's Inner Workings
Users sign up and follow experienced traders’ predictions, which are called Blueprints. In exchange, traders earn rewards for the accuracy of their Blueprints.
“The predictions are posted on the blockchain, so you can’t delete any recommendation or trading calls. This way, we create a permanent track record,” said Waslen.
The HedgeTrade model ensures that Blueprints are faithful through a staking process in which traders making predictions store collateral on the Ethereum blockchain.
“The user pays to unlock the prediction,” Danihel said.
- If predictions are correct, traders receive their stake and proceeds from purchasers.
- If predictions are incorrect, purchasers are refunded and traders lose their stake.
HedgeTrade In Action
Waslen gave Benzinga an example of how the HedgeTrade platform can net more than $15,000 in profit for less than $200 in risk.
“Let’s say a trader stakes $200 on a prediction and then the purchase price to unlock it is $20,” he said.
“If they have 10,000 followers and 1,000 of those followers unlock this prediction, that’s 1,000 people times the $20, which is $20,000.”
After distributing commissions out to affiliates, this trader would earn upwards of $15,000 on a single prediction with a downside of $200, the maximum risk.
Next Steps For HedgeTrade
“We launched beta in December; so far, it’s going really well,” Waslen said.
Going forward, HedgeTrade aims to expand the platform beyond cryptocurrencies, add a leaderboard and increase ranking transparency.
The idea is to makeit easy to act on equity, derivative, forex, commodity and even sports betting predictions.
Additionally, HedgeTrade aims to place an increased emphasis on social features like real-time notifications, badges and copy portfolio features.