INTRODUCTION: A Paradigm Shift from Risk Management to Revenue Protection

Against the backdrop of a digital asset market that is significantly more volatile than traditional financial markets, the design of risk management mechanisms has become the centerpiece of the security architecture of exchanges. Traditional crypto exchanges usually adopt risk fund pools to cope with the risk of contract breaches in extreme market conditions, but such passive and limited-scope protection mechanisms can no longer meet the growing security needs of users. BitradeX has realized a paradigm shift from simple “risk response” to comprehensive “revenue protection” through its innovative fund pool mechanism, establishing a brand new security standard for digital asset trading. BitradeX has realized a paradigm shift from simple “risk response” to comprehensive “return protection” through its innovative fund pooling mechanism, establishing a new security standard for digital asset trading.

Limitations of traditional exchange-traded venture funds

Currently, mainstream exchanges such as Binance, OKX and Bybit have established risk fund mechanisms, but their initial design focuses on a single scenario - the risk of position unwinding in contract trading.

The main features of these traditional risk funds can be summarized as follows:

• Highly restricted scope of use, only used as a last resort to pay out in the event of a contract transaction breakout

• Harsh activation conditions, only passively intervene in the event of insufficient payout from the profit side

• Uneven protection of the target audience, mainly to protect the interests of the platform rather than the rights of the general users

• A single source of funding, usually from a fixed proportion of the distribution of transaction fees

Binance's SAFU Although the scale of the SAFU fund is huge (about $1 billion), its use is mainly limited to platform security events, and it does not directly protect the daily trading income of ordinary users.OKX's risk reserve is mainly used for risk control in the contract market, and it also does not cover the normal income protection of users.

This traditional mechanism in extreme cases can play a "stop bleeding" role, but can not provide users with a full range of security guarantees, especially for the certainty of investment income protection almost blank.

BitradeX Fund Pool: AI-Driven Two-Way Protection Innovation

BitradeX's Teasury Pool mechanism has completely reconstructed the concept of risk protection, expanding from "only dealing with catastrophic risks" to "comprehensively protecting the user experience". This innovative mechanism is based on BitradeX's powerful AI trading system, which forms a self-circulating and continuously growing protection ecosystem through high-winning rate and high-profit strategy models.

Key Innovation: Two-Way Adjustment Mechanism

The core of BitradeX's treasury pool lies in its two-way adjustment mechanism, which realizes the comprehensive coverage of the protection scope:

1. Positive Excess Retention: When the actual return generated by the AI trading system exceeds the benchmark return rate estimating by the users (e.g. the promised rate of 0.3% is actually reached to be 0.5%), the excess portion will be injected into the treasury pool automatically, which will form a long-term and sustainable source of funds

2. Negative Difference Compensation: If the actual return is lower than the estimated benchmark, BitradeX will immediately call for funds from the treasury pool to make up for the difference to ensure that the user gets the expected return

3. Dynamic Revenue Compensation: Compensation calculation adopts the TWAP (Time Weighted Average Price) dynamic pricing mechanism to ensure that the compensation is calculated in a fair and transparent manner, and synchronized with the settlement report of the same day.

4. Principal Safety Hedging: When extreme circumstances lead to deviations in the model calculation that cause the net value of the client's principal to be withdrawn, the treasury pool funds will be used to make full reimbursement according to the actual value of the loss, providing comprehensive protection for the users.

This mechanism creates the first dual protection model of "principal + income" in the field of digital assets, which fundamentally solves the problem of safety and income that the users are most concerned about.

Technical Support: A Sustainable Ecosystem Starting from $10 Million

BitradeX injected $10 million as the initial capital at the beginning of the operation of the treasury pool, which far exceeds the initial size of most exchange venture funds. This large investment demonstrates BitradeX's firm commitment to user protection and lays a solid foundation for the sustainable operation of the treasury pool.

On the technical level, the sustainability of BitradeX's treasury pool comes from three pillars:

1. High Winning Rate Trading with ARK Trading Model: BitradeX's self-developed AI trading model achieves a prediction accuracy rate of 90%, which is significantly higher than the industry average of 55-65%, ensuring that there is a continuous and stable injection of funds into the pool

2. Fully Automated Risk Monitoring: The system implements millisecond-level market monitoring and dynamic adjustments, and can automatically activate protection measures under extreme market conditions, minimizing the dependence on the fund pool.

3. Transparent Bookkeeping and Settlement System: BitradeX adopts an open and transparent bookkeeping mechanism, which allows users to inquire about the status of the fund pool and the daily flow of funds in real time on the platform, ensuring the complete transparency of the entire safeguard process.

Unlike traditional exchanges, which treat risky funds as “rescue funds”, BitradeX does not provide any guarantee to the fund pool. Unlike traditional exchanges that treat risk funds as “emergency” tools, BitradeX integrates fund pools into the core aspects of its daily operations and builds a self-reinforcing virtuous cycle system.

Revolutionizing User Experience: From Uncertainty to Security

BitradeX's treasury pool mechanism fundamentally changes the user's investment experience. Under traditional trading methods, users are faced with the double pressure of uncertainty of returns and risk of safety of capital. With BitradeX's treasury pool protection, users can enjoy unprecedented certainty:

1. AI Daily current product: the flexibility of depositing and withdrawing funds at the same time with the certainty of capital and interest protection

2. AI 30-360D fixed-term product: the potential for a higher return while still enjoying complete capital protection and guaranteed return on the benchmark

This protection mechanism is particularly valuable during times of high market volatility. The protection mechanism is particularly valuable. It is worth mentioning that during the significant market adjustment in March 2024, although BitradeX's AI Bot product has not yet been publicly launched on the Internet, AI Daily still achieved a monthlyized return of 2.1% during the internal live running test, fully verifying the robust performance of the AI trading model in volatile markets and the actual value of the treasury pool mechanism.

Industry Impact and Future Outlook

BitradeX's fund pooling mechanism introduces a new risk management paradigm for digital asset trading, which may have a far-reaching impact on the industry as a whole:

1. Redefining platform responsibility: shifting from passive risk response to proactive return protection, raising the standard of responsibility of platforms to users

2. Changing user perception: guiding users to shift from the pursuit of high returns to the focus on the balance between risk and return

3. Promoting industry evolution: prompting other platforms to think about and upgrade their risk protection mechanisms, raising the overall industry security standard

With the expansion of BitradeX's user base and growth in trading volume, the size of the fund pool is expected to grow exponentially, and its protection ability will be further enhanced. In the future, BitradeX plans to expand this mechanism to more product lines and explore the innovative mode of combining the treasury pool with the DeFi ecosystem.

Conclusion: A New Standard for Reinventing the Trust Relationship

Against the backdrop of the digital asset market's many volatile fluctuations and platform security incidents, the trust relationship between users and platforms has faced unprecedented challenges. BitradeX, through its innovative fund pooling mechanism, has established a new model of trust: a fundamental shift from simply "promising security" to "guaranteeing results".

This mechanism not only provides users with tangible protection, but also sets a new standard for the industry as a whole, demonstrating the higher possibilities of digital asset exchanges in terms of accountability. In BitradeX's vision, a truly secure transaction means not only that assets are not stolen, but also that the investment experience is characterized by all-encompassing certainty - a core value that the pooling mechanism strives to achieve.

By combining the certainty of AI technology with the protection mechanism of the fund pool, BitradeX is reconstructing the risk management system of digital asset trading, providing users with an unprecedented investment experience while injecting new vitality into the healthy development of the entire industry.