SUMMARY... 3 INTRODUCTION... 4 DEVELOPMENT STAGES... 5 INVESTORS... 7 ARBITRAGE INVESTMENT STRATEGY... 9 BLOCKCHAIN-BASED FUND TOKENS...

Transcription

1 Whitepaper

2 Table of Contents SUMMARY... 3 INTRODUCTION... 4 DEVELOPMENT STAGES... 5 INVESTORS... 7 ARBITRAGE INVESTMENT STRATEGY... 9 BLOCKCHAIN-BASED FUND TOKENS ECONOMIC MODEL TECHNICAL SOLUTIONS RISK MANAGEMENT FUND LIQUIDATION DISCLAIMER GLOSSARY... 18

3 SUMMARY Areum Fund is a tokenized blockchain-based fund, which implements the strategy of classic futures arbitrage in cryptocurrency markets using its own original technical solutions. The strategy of classic futures arbitrage allows to make profit on the volatility of cryptocurrency market, regardless of direction of currencies trend. Simultaneous transactions of the opposite direction for an equivalent number of positions in the futures market and the spot market lead to the creation of the market neutral position, at which the percentage of profit that will be realized by the expiration date of the futures is fixed at once. Fund's activities are completely transparent - fund performance indicators such as tokens rate of return, Areum Fund Index, the volume of transactions, the amount of funds under management are updated daily and published on the Fund s website. Investing in Areum Fund is carried out by purchasing of fund s tokens with cryptocurrency in the customer's Personal Account, further the money received from investor are transferred to the management of the fund. Personal Account displays information on the account balance, charts of the tokens prices, statistical profitability indicators, referral payments. The increase in tokens prices occurs as a result of fixing the profit due to the implementation of the arbitrage trading strategy. Tokens can be requested for buyback at any time through the investor's Personal Account, the profit of the investor is calculated as the difference between the sale price and the purchase price of the token. 3

4 INTRODUCTION Nowadays more and more people are interested in cryptocurrencies, they enter this market thus increasing its capitalization. Due to tremendous growth of the cryptocurrency market and blockchain development, new promising ways for fund investments. However, the cryptocurrency market is still quite volatile, so the vast majority of investors are wondering: how to choose the right investment strategy, which will allow to obtain an increased profitability with a minimum level of risk. That's why our team of traders, financial experts and IT professionals has developed and implemented the trading strategy of CLASSIC FUTURES ARBITRAGE at cryptocurrency exchanges. On the one hand, this strategy has been successfully applied in all developed exchange markets, and on the other hand, due to cryptocurrency market being on the primary, but at the same time turbulent development stage, the arbitrage strategy on this market provides INCREASED and, indeed, the RISK-FREE RETURN. This strategy provides a possibility to make profit on the volatility of cryptocurrency market, regardless of currencies trend direction. We have developed unique automated trading mechanisms allowing to maximize profitability of arbitrage transactions. From the inception of the idea to its implementation into practice, namely, the beginning of the work of the public fund, a number of successive stages have been passed, which are presented below: 4

5 DEVELOPMENT STAGES Inception of an idea and team building Recognized experience of trading in stock market Implementation of successful projects of business processes automation Successful mining project Analysis of cryptocurrency markets, analytics, testing of various trading strategies Infrastructure and development We have created, tested and optimized the ITinfrastructure: 1) technical platform for trading; 2) dashboard system for analytics; 3) telegram-bot for alerts and notifications. Fund's team has been expanded Strategy and scripts of traders are regulated Continuous testing of the arbitrage strategy at our own expense The total volume of funds under management is $ Fund functional testing July 2017 March 2018 May 2017 Development and testing of the strategy We have developed and tested in manual mode several arbitrage strategies (at our own expense) We have held numerous consultations with expert community of this industry The required parameters of the organizational and ITinfrastructure have been defined Sept Preparation of the fund for public launch Information and reporting documents of the fund are created (Whitepaper, internal regulations) Fund NEM blockchain-based tokens are developed Website is created The Investor's Personal Account of the Manager's Personal Account are created Exchanges accounts are opened, resisted and verified We have successfully tested: 1) technical trading platform 2) backend server for assets management 3) website with Investor's Personal Account 4) issue, purchase/sale, buyback, transfer and storage of fund tokens The total volume of funds under management is $ The staff has been expanded 2018 Dec 2018 Apr Commencing of public activities Fund's marketing Attracting new investors Formation of the reserve account (at the expense of our own money, the Fund managers) Receiving feedback from the investors for expansion of the functionality of the Personal Account Preparation and launch of a marketing company in Japanese, Chinese and Korean markets Independent audit of the fund functioning Preparing guidelines to optimize trading strategies of the fund as a result of accumulation and analytics of statistical data of the fund s functioning in (using the tools of mathematical statistics and probability theory) Dec Listing of fund tokens on cryptocurrency exchanges Optimization of the fund s trading strategy, including: 1) Development of the futures arbitrage strategy based on the Fund's performance for ) Inclusion the intermarket arbitrage strategy into fund's trading strategy Technological optimization, including: 1) Dashboard's and technical trading platform update (refinement, integration with new exchanges, adding new trading pairs) 2) Servers and hardware update Fund team expansion (traders, analysts, IT professionals) 5

6 STRATEGY RATE OF RETURN % % % % % % % % % % % June 2017 June 2017 August 2017 September 2017 October 2017 November 2017 December 2017 January 2018 February 2018 Мarch 2018 Аpril 2018 Areum Fund Team have brought together leading experts from the economic field with extensive experience in classic stock market and IT executives, having implemented many projects on business automation. This professional alliance has enabled the development of a unique arbitrage product on cryptocurrency market, which enables traders to avoid many industry problems and creates opportunities for increased profits of the fund. Sectoral problem Areum Fund solution Integration complexity Many exchanges are working with API support, but they use different standards that are not suitable for existing professional software and trading terminals. This leads to inconvenience of the user and complexity of trading at cryptocurrency exchanges, such as inability to connect individual exchanges to classic software for trading and long delays in data interaction with exchanges. Development of engineering solutions The team of the fund has developed the original software (a technical trading platform with alert system), which work is provided by our own technical means (servers that collect data with minimal delay and send them to user) that provide a possibility to integrate all appropriate platforms into a single interface with minimum delays and maximum convenience. Low liquidity Liquidity of the same cryptocurrency asset differs from exchange to exchange. Therefore, with a low liquidity of an asset at a certain exchange, there are large spreads and a low transaction frequency, which makes it impossible to instantly open a short / long position for the asset to the entire required volume. Aggregation of cryptocurrency liquidity Diversified policy of the fund involves allocation of the fund money in several major platforms that allows to instantly aggregate liquidity of trading pairs, revealing long/short equity on different platforms at the same time. 6

7 High fees for inter-exchange transfers Cryptocurrency exchanges charge, as a rule, a fixed fee for withdrawal of cryptocurrencies to other exchanges/wallets. Taking into consideration that arbitrage involves constant movement of funds between the exchanges, the fee for withdrawal may exceed the revenue earned from arbitrage. Minimization of fees costs due to scale effect The fund implements the arbitrage strategy using a large amount of funds, due to which fees for inter-exchange transfers are insignificant in the total income from arbitrage transactions. High cryptocurrency market volatility Sharp fluctuations in the prices of cryptocurrencies may lead to a decrease in the value of the deposit and investor's profit because of Bitcoin devaluation. Hedging policy The fund hedges the deposits received from the investor by opening a short futures position on Bitcoin as well as hedging the profit after each close positions in both markets and fixing income. INVESTORS Areum Fund offers its clients not only a platform for trading but a fully functional product for investment. Areum Fund has been primarily created for people oriented for profitability, free of currency and market risks. The target group consists of investors who already own certain cryptocurrency assets and already have some idea of the crypto-sphere, who want to invest some of their financial assets with the rate of return higher than the market average offered by classic financial instruments. It is expected that the Areum Fund strategy will be primarily of interest to investors, who have cryptocurrency assets derived from mining or who have invested in BTC and ETH. After transfer of these cryptocurrency assets under the management of Areum Fund, the investors will be able to increase their capital not only due to the increase of cryptocurrency rate, but also due to additional profit from Fund arbitrage operations, payable in cryptocurrency, chosen by the Investor. At the same time, those investors who do not want to depend on the fluctuations in the cryptocurrency rate in principle, with the use of Fund Areum strategy (token USDA) can fully hedge the risk of loss of assets due to unfavorable trend of Bitcoin rate, and at the same time receive higher rate of return. 7

8 How to become an Areum Fund investor Investor Website Personal Account Registration in Personal Account Verification (optional) Token selection TOKENS Generation of personal wallet Token purchase Reporting Arbitrage trading transactions, profit taking Token transfer to personal wallet Fund Management Development and technical support Allocation of profits 50%/50% Increase of token price Token sales Investor Reserve fund Fund Managers 8

9 ARBITRAGE INVESTMENT STRATEGY Arbitrage investment strategy of Areum Fund is focused on maximizing the return on investments with simultaneous minimization the risk level. The main Fund strategy is the classic futures arbitrage on cryptocurrency exchanges. Classic futures arbitrage is a simultaneous performance of transactions of the opposite direction with an equivalent number of positions on the futures market and the spot market. This strategy involves on the one hand purchase of cryptocurrency on one exchange and, on the other hand, sale of futures for the same cryptocurrency at another exchange. This creates a market-neutral position providing fixed profit interest, which will be realized by the futures expiry date. The strategy 'Classic futures arbitrage' Deposit 10 BTC Deposit distribution between among exchanges: 50%/50% Opening of symmetric positions at two exchanges (with leverage) Expiration of futures and closing of symmetric positions in the spot Profit taking BTC BTC Divergence of price of futures and spot price (underlying asset) 5% Futures price Spot price 0.1 BTC Opening date Opening date of futures of symmetric contract positions Expiry date of futures contract Simultaneous opening of positions: Sale of futures pcs. (0.105 BTC per item) Purchase of spot pcs. (0.1 BTC per item) closing is performed automatically by the exchange Simultaneous closure of positions: Purchase of futures pcs. (0.102 BTC per item) Sale of spot pcs. (0.102 BTC per item) Total profit = Profit from futures + Profit from spot = 0,3 BTC + 0,2 BTC = 0,5 BTC (Profit 5%) TOTAL BALANCE [0.105 BTC (sale price) BTC (purchase price)] * 100 (number) = 0.3 BTC [0.102 BTC (sale price) BTC (purchase price)] * 100 (number) = 0.2 BTC 10,5 BTC The strategy of Maximization of classical futures arbitrage rate of return allows to get extra yield when implementing the concept of classic futures arbitrage. If the convergence of spot price and the price of futures contract occurs before an expiration date or there is an opportunity to enter the tool with a higher rate of return than the current one, a trader fixes this profit and transfers it to new tools using similar strategy. This accumulated result allows to get extra yield in respect of open positions. 9

10 The strategy Maximization of the classical futures arbitrage rate of return Futures price Spot price 5% 3% Altcoin 1 4% 2% Altcoin 2 3% Altcoin 3 Date of opening of futures Expiry date of futures contracts Opening positions on Altcoin 1 Simultaneous opening of positions with expected yield 5%: Sale of futures - 20 pcs. (0.525 BTC per item) Purchase of spot - 20 pcs. (0.5 BTC per item) Closing positions in Simultaneous closing of positions with fixation of profits 2%: Purchase of futures - 20 pcs. (0.52 BTC per item) Sale of spot - 20 pcs. (0.505 BTC per item) Opening positions in Altcoin 2 Simultaneous opening of positions with expected yield 4%: Sale of futures pcs. (0.104 BTC per item) Purchase of spot pcs. (0.1 BTC per item) Profit = 0.1 BTC BTC = 0.2 BTC (2%) Profit from futures [0.525 BTC (sale price) BTC (purchase price)] * 20 (number) = 0.1 BTC Profit from spot [0.505 BTC (sale price) 0.5 BTC (purchase price)] * 20 (number) = 0.1 BTC Profit = 0.1 BTC BTC = 0.2 BTC (2%) Total profit BTC (profit from Altcoin 1) 3 4 Closing of positions in Altcoin 2 Simultaneous closing of positions with fixation of profits 2%: Purchase of futures pcs. (0.103 BTC per item) Sale of spot pcs. (0.101 BTC per item) Closing of positions in Altcoin 3 Simultaneous closing of positions at expiration of futures: Purchase of futures pcs. (0.051 BTC per item) Sale of spot pcs. (0.051 BTC per item) Opening positions in Altcoin 3 Simultaneous opening of positions with expected yield 3%: Sale of futures pcs. ( BTC per item) Purchase of spot 200 pcs. (0.05 BTC per item) Profit from futures [0.104 BTC (sale price) BTC (purchase price)] * 100 (number) = 0.1 BTC Profit from spot Profit = 0.1 BTC BTC = 0.2 BTC (3%) Profit from futures [ BTC (sale price) BTC (purchase price)] * 200 (number) = 0.1 BTC [0.101 BTC (sale price) 0.1 BTC (purchase price)] * 100 (number) = 0.1 BTC Profit from spot [0.052 BTC (sale price) BTC (purchase price)] * 200 (number) = 0.1 BTC BTC (profit from Altcoin 2) BTC (profit from Altcoin 3) 0.7 BTC (7% of deposit) Closing of futures contract is performed automatically 10

11 Within this investment strategy trading is carried out at several platforms: - in the SPOT Biaffine, Poloniex, Kraken markets - crypto-currency pairs are traded; - in the URGENT Bitmex, Deribit market - futures for the same tools are traded. The main advantages of working in the futures market are: The possibility of implementing of arbitrage strategy: recurring price difference between spot and future assets allows to make profit with minimal risks. The possibility of hedging risks: the original purpose of futures and options is to remove risks arising due to changes in the prices of commodities or currencies. Therefore, if the investor doesn't want to bear the risks of Bitcoin exchange rate, a short futures position on the BTC opens to hedge the deposit and the investor's profit. Hedging of the entire deposit amount is opened when the investor purchases the tokens corresponding to this strategy (strategy with hedging - USDA). Hedging of profits within this strategy occurs at the moment of closing positions in both markets and fixing profits. For investors who do not wish to undertake hedging of their deposits and profits (in order to generate additional revenue from the possible increase in the rate of the underlying asset), Areum Fund proposes investing in the relevant tokens without opening a hedge: BTCA and ETHA. The possibility of trading with leverage: the use of leverage (borrowed capital) in the futures and spot market allows to increase the profitability of the fund. The fund uses a leverage no larger than 1:1 (a unit of borrowed funds is used per unit of equity). Thus, by receiving a deposit from an investor and distribution deposit 50%/50% to the futures and the spot exchange, the fund uses at each exchange a 1:1 leverage, operating with the full amount of the deposit on each exchange. 11

12 BLOCKCHAIN-BASED FUND Specific feature of Areum Fund is that it is a tokenized fund. Investors purchase tokens which represent their share in the Fund. The management of tokenized Areum Fund is based on the New Economic Movement (NEM) blockchain. Working with the NEM-blockchain allows the fund to issue its own token for each investment strategy which enables investors to select exactly those fund tokens that meet their requirements in respect to the rate of return and their risk appetite. Blockchain key advantages: Transparency & openness of transactions Sustainability & availability Safety & reliability The concept of creation of the fund on blockchain basis fully meets the safety requirements and corresponds to essential targets of Areum Fund: - secure storage and transfer of digital assets without intermediaries; - international availability and 24/7 trade; - transparency (free public access for our own users). 12

13 TOKENS Every time the investor sends Bitcoin (BTC), TrueUSD (TUSD) or Ethereum (ETH) at the address of a wallet generated in his Personal Account, Areum Fund issues a corresponding token based on the price calculated at 12:00 UTC every day. Areum Fund issues 3 types of tokens: USD Areum (USDA), BTC Areum (BTCA) and ETH Areum (ETHA). The distinctive features of each of these tokens are as follows: USDA is management within the arbitrage strategy with the hedging of the Bitcoin (BTC) rate relative to the rate to USD. Hedging investor's funds is carried out when the tokens are acquired by opening a short futures position on Bitcoin. The deposit can be made either in TUSD or BTC at the investor's option. The fixation of profits from arbitrage trading transactions also occurs with respect to the rate of BTC to USD. BTCA is management within arbitrage strategy in Bitcoin (BTC). The investor can purchase this token and request its buyback in Areum Fund only in BTC. Profit-taking from arbitrage transactions takes place in BTC. ETHA is management within arbitrage strategy in Ethereum (ETH). The investor can purchase this token and request its buyback in Areum Fund only in ETH. Profit-taking from arbitrage transactions takes place in BTC. The price of each of the tokens is calculated separately with the use of the same algorithm, namely: USDA TOKEN PRICE = (TOTAL INVESTMENTS IN USDA + RETURN ON INVESTMENT IN USDA * 50%)/NUMBER OF USDA TOKENS BTCA TOKEN PRICE = (TOTAL INVESTMENTS IN BTCA + RETURN ON INVESTMENT IN BTCA * 50%)/NUMBER OF BTCA TOKENS ETHA TOKEN PRICE = (TOTAL INVESTMENTS IN ETHA + RETURN ON INVESTMENT IN ETHA * 50%)/NUMBER OF ETHA TOKENS Every time the token holder sends his tokens in Areum Fund for buyback, these tokens get destroyed. The payment is calculated based on the price of corresponding token, accrued at 12:00 UTC every day. The investor may also buy and sell tokens of the fund in the open market. 13

14 ECONOMIC MODEL Entry fee. Any time an investor wants to enter Areum Fund, he may buy the fund tokens without paying any fees (0%). Token transfer fee. When transferring Areum Fund tokens to other wallets, the transfer fee is charged in the amount established by the NEM (New Economy Movement) network settings. The maximum size of the fee is 1.25 XEM. Exit fee. Any time an investor (token holder) wants to exit Areum Fund, 0.5% of the proceeds from tokens sale in cryptocurrency chosen by an investor will be held by the Fund as a commission fee. In order to ensure security, the operation time for withdrawal of investor's funds may be increased up to 48 hours. Success fee. Income generated from arbitrage transactions is allocated in the ratio of 50%/50% among the investor and the fund manager. Accrual of success fee: - the fund's results are calculated on a daily basis and are reflected in the prices of the tokens; - success fee is also calculated daily at the time of fund calculation results and it is charged at the rate of 50% by fund managers from fund profits solely if a token current price is higher than the last price of token, from which fund managers have previously held a fee ("high water mark"). This mechanism makes the process of obtaining fee by fund managers transparent and predictable, and it also helps to avoid significant fund token price change after collection a success fee. This mechanism also provides fair profit distribution for all fund investors and for those who have joined the fund in the early stages as well as for new investors; - fund performance indicators in the investor's Personal Account are displayed with deduction of a Fund fee - this enables each investor to see the net rate of return of their deposits. 14

15 TECHNICAL SOLUTIONS Technical solutions for Areum Fund consist of three main elements: customer-oriented website with the investor's Personal Account, the backend server for assets management and technical trading platform. Personal Account Website Every 24 hours the following fund indicators are automatically updated on the website: rate of return of Areum index; volume of transactions (from the date of foundation); amount of funds under management. Also, the dynamics of Areum index and the dynamics of the change in the price of each token are displayed graphically. A client willing to invest in Areum Fund has to complete registration procedure in his Personal Account (via website's interface). Personal Account displays information about the account balance and all statistical profitability indicators, referral payments. Every investor may buy/sell/withdraw the fund s tokens via his PA. To purchase the fund s tokens, the investor receives automatically generated personal wallet number in cryptocurrency at his discretion (BTC, TUSD or ETH). Every investor has the opportunity to go through verification procedure and install two-factor identification (with keeping a backup key copy) to enhance safety. Technical solution Backend service Backend service is in charge of: calculation of the prices of the tokens and index of Areum Fund; launching of new tokens issue and burning of tokens requested for buy-back (as soon as we receive data about buying/selling the tokens through Investor's Personal Account); storage of investors' wallet addresses. Technical trading platform The Areum Fund team has developed its own unique technical platform for trading. This platform provides quick and efficient trading within the framework of arbitrage strategy minimizing the decision time and maximizing the convenience of implementation of solution by: availability of a dashboard with multiple levels of information decomposition. A dashboard with the use of API integrates information simultaneously on all required platforms, in addition flexible dashboard settings allow the trader to display information on assets and platforms he needs on just 1 screen; availability of alert system. One of the dashboard functions is to display opportunities for opening/closing positions on futures arbitrage in decreasing priority order (in respect of expected profit), as well as two types of alerts for traders on the occurrence of priority features: visual display within dashboard and the direction of the audio and visual alerts through the mobile app; possibility to trade (open and close positions) through the API, avoiding the problem of exchange websites overload. The platform implements elements of algorithmic trading, which allow a trader to efficiently operate large-volume transactions. The technical platform for trading is supported by our own servers and other special fund equipment that provides uninterrupted and continuous platform operation and allows for collection, processing and sending data with minimum delay. 15

16 RISK MANAGEMENT Even though the concept of futures arbitrage is a risk-free strategy, there are a number of external factors that could affect the fund s operations. The Fund uses an integrated approach for efficient protection of investors' funds, taking into account different risk categories and implementing risk management activities as follows: Type of risk Risk Activities aimed at risk management Regulatory risk Restrictions and prohibitions on transactions with cryptocurrency by legislation of certain countries Working with exchanges of countries that are loyal to cryptocurrencies Market risk Bankruptcy and exchange closing The risk of cyberattacks on the fund Risk of a decrease in the value of an investor's deposit as a result of Bitcoin depreciation Risk of a decrease in profits as a result of Bitcoin depreciation Closing of cryptocurrency Exchanges as a result of the influence of endogenous factors Cyberattack on exchanges Cyberattacks on Fund's website Liquidity risk Insufficient liquidity of cryptocurrency tool in the exchange Hedging of funds received by the fund from the investor by opening short futures position in Bitcoin Hedging of profits after each closing of positions in both markets and fixation of income Diversification of the fund's assets among the largest exchanges with the highest rating - Using the maximum level of verification of all fund accounts; - Working with exchanges ensuring the maximum level of participants funds protection: - working with exchanges holding a major share of funds in cold wallets; - exchanges with 3 or more stages of identity verification when logging in the account, in trading and withdrawal of funds from the account The investors' assets get immediately transferred to cold wallets during tokens purchase to avoid the risk of cyber-attacks on Fund assets Working with high-capitalization tools Purchasing the fund tokens, the investor agrees that he understands and accepts these risks and potential losses within the fund without the possibility of recovery. 16

17 FUND LIQUIDATION The following events may cause the liquidation procedure: - general decision of fund managers; - inability to manage the fund by any of the managers. In the event of liquidation, the following procedure will be performed: 1. Notification of token holders on fund liquidation and the beginning of the procedure of tokens buyback. 2. The closure of all trading positions on the futures market and the spot market within 4 weeks. 3. Receiving token holders' requests for tokens buyback with indication of the cryptocurrency and personal addresses. 4. Buyback of tokens from their holders in cryptocurrency specified in buyback request and transfer of funds at the specified address. 5. In the absence of the investor's token buyback request, funds transfer is effected in the cryptocurrency, chosen by the investor upon initial deposit to the registered address of the investor. DISCLAIMER The information provided in this document is not intended to be distributed or used by any person or persons in the USA (hereinafter referred to as the United States, including Puerto Rico, the US Virgin Islands and any other US domain) or the Republic of Singapore or China, or in any jurisdiction or country, where such distribution or use is, or will be, contained in any legislation or regulation that may expose Areum Fund and/or persons (including their affiliates) creating fund tokens or any of their products such as are for or services to any registration, licensing or other requirements applicable in these jurisdictions or countries. You are not allowed to purchase fund tokens, if you are a citizen of the United States or permanent resident of the United States. By purchasing fund tokens, you confirm and guarantee that you are not an authorized employee of the company, owned by the United States citizens or permanent residents of the United States. You shall immediately notify Areum Fund if circumstances have changed. Areum Fund reserves the right to refuse purchasing fund tokens by any person who does not meet the criteria necessary for their purchase in accordance with the established rules of the fund. This document is intended for general information purposes only. This document is not and does not pretend to be any kind of professional advice, recommendations or independent review. Therefore, the information contained in this document has been prepared in accordance with the relevant rules and regulations governing such publications in any jurisdictions. 17

18 GLOSSARY Altcoin Generic name for all cryptocurrencies, excluding Bitcoin and Litecoin. Arbitrage Several successive transactions aimed at extracting profit from the difference in prices for the same or related assets, at the same time in different markets, or at different times in the same market. Blockchain Data storage technology in which information cells follow one another in certain sequence. Copies of such chains are stored in a large number of computers that, along with encryption, provides maximum data protection. Volatility Statistical indicator, which characterizes the tendency of price variability. Dashboard Software that automatically collects, processes the data and provides signals for trading. Areum Index It is calculated as a weighted average rate of return of all Areum Fund tokens. Leverage Borrowed funds that exchanges and brokers provide to their clients for trading in the financial market. Cryptocurrency Fund / Cryptofund Fund specializing in investments in cryptocurrencies. Discrepancy Excess of the futures price over spot price. Spot Terms of settlements where payment for transaction is effected immediately. Futures market (derivative market) Market where fixed-term contracts (forwards, futures, options) take place. Token Digital asset (cryptocurrency of the fund), which the investor receives from the company in exchange for another cryptocurrency. Trading Activities aimed at the performance of trade operations, the main purpose of which is to obtain profit from the difference in the purchase price and the sale price of financial assets. Futures (futures contract) Derivative financial instrument, the standard futures exchange contract for the purchase and sale of the basic asset, under which the buyer agrees to buy, and the seller agrees to sell certain basic asset on a certain date at the price agreed in the contract. 18

19 Futures arbitrage Simultaneous transactions with the opposite direction for an equivalent number of positions on the futures market and the spot market. Hedging with a futures contract Transaction (opening position) in the futures market, which is identical in its features to the investor's position, but opposite in its essence. The main task of hedging is protection against currency exchange risks. Hedge Fund Investment fund focused on maximizing profitability at a given risk or minimizing risks for a given profitability. 19