Submitting a Strategy

Overview

Each strategy a user develops can be submitted for approval using an incentivized community voting system. Submitted strategies are first compared for uniqueness against other strategies submissions at the time. Strategies that are too similar to other submissions are filtered out, and remaining strategies are evaluated by their Alpha.

Users who stake TGEN can validate strategy submissions by running backtests and cross-checking the results with both the developer’s results and the minimum criteria. Validators are also asked to check for inconsistencies in the strategy (such as requiring the latest price to be both higher and lower) and to check for unique strategy name or symbol. They can vote to approve or reject the strategy based on the results they find.

When the strategy gets enough votes, the strategy is approved or rejected based on the majority vote. If less than 80% of the vote is for one decision, the strategy’s vote limit is raised and voting continues. If the strategy is approved, an on-chain trading bot for that strategy is generated and fungible tokens for that strategy are created. If the strategy is rejected, the submission gets removed from the voting page and the developer may submit the strategy again. Validators for that strategy will receive TGEN as compensation for validating the strategy, regardless of the final decision. Validators who submitted dubious votes (determined on a smart contract by comparing against other votes, the developer’s results, the minimum criteria, and other published strategies) lose a portion of their staked TGEN.

What is Alpha?

Alpha measures the performance of a strategy relative to holding the underlying asset, while taking into account trade frequency. Strategies with high trade frequency have a lower Alpha because such strategies would have to pay more in exchange fees. By default, strategies that perform worse than holding the underlying asset have a negative Alpha and may get filtered out automatically depending on the difference in performance.