Pricing
Last updated
Last updated
Requesting a price for an asset is applicable for the creation of Proof of Ideas only (it is implicit for Proof of Trade).
The price at which an Investment Idea is opened, adjusted and closed is one of the most important attributes of any trading signal and proving this price is a key part of AlphaCapture.
The main objective is to provide a transparent price which can not be tampered with. Even if this comes from a centralized service which must be trusted, the key is to communicate where the price came from, at what exact time and at what exact price.
Prices are obtained from your providing provider. You are requesting the price.
This happens in several steps:
When creating the idea using the AlphaCapture SDK, the pricing provider is specified from a list of supported providers. This could be a CEX, DEX, brokerage or data service.
In addition to specifiying the provider, any credentials must also be detailed
This credentials are your credentials
AlphaCapture is not a pricing provider; you are not requesting a price from AlphaCapture and your details never pass through AlphaCapture
During the creation process, the SDK will make a request to the specified pricing provider, using your provided credentials, via an Oracle equivalent
Note that we use Lit Protocol (see ) who offer Lit Actions, a distributed Oracle equivalent
The returned pricing data is digitally signed and submitted with the Idea request; the signing process ensures that the data can be altered
Attempts to change the data will result in black listing
The request for the price is the first step in the Idea creation process. Even though it can take time to mint the resulting NFT, the price will reflect the request at the start of the process.
The price
For any given Investment Idea, the pricing provider used when creating the Idea, must be used when subsequently adjusting or closing that Idea. You cannot use one pricing provider to open a new Investment Idea and a different provider to close the same idea.
It should be thought of like a real position - the position exists at the brokerage so it must be closed there.
If pre- and post-market pricing is available at your preferred pricing provider, then they can be used. While trading in pre and post markets is not available at all brokers, it is reasonable that this is still a tradable price and is therefore valid. Note that this may have an impact on how your clients execute any resulting trades (and whether their broker supports pre & post markets).
It is recognised that when requesting a market price, this will not necessarily be the same price that a trade would execute at, where the size of the trade could have a significant influence on the executed price.
We offer a best efforts approach - the market price at the time of the request will be the closest price to the executable price. There is no concept of order size when creating an Investment Idea and so it is not possible to allow for slippage at this point.
There are two options to reduce this limitation:
Use Proof of Trade rather than Proof of Idea - where a trade is confirmed to have taken place, this will communicate the executed price at the order size you placed (the order size/value is not communicated).
The raw strategy data can be used to calculate performance while allowing for a wider spread.