The Signal Token will be an Ethereum blockchain based ERC 20 token. All paid features available on the Signals Platform will be accessible exclusively using Signal tokens. Signals’ business model is based on two main revenue streams.
First, Signals charges a fee on each purchase in the Signals marketplaces. This includes:
• Purchases of user-created indicators in the Indicator Marketplace
• Purchases of data streams in the Data Marketplace
• Renting of user-made strategies for copy trading in the Strategies Marketplace
• Using premium machine learning features in order to assemble and train trading
The second revenue stream comes from the Signals cloud solution for deploying strategies. A subscription model will be implemented, with several tiers to choose from based on the amount of strategies used.
As the fundamental building block of any strategy, data is an essential part of creating powerful analytical tools. With Signals, users and external vendors are able to monetize their unique data sets in the Data Marketplace. These data sets include historical and current market data, social networks data from Facebook, Twitter and others, as well as other crypto related media and sites. Any type of data set can be uploaded to the Data Marketplace and priced accordingly. Integration of data crawlers that provide live data streams or API access for third-party data is quick and can be done seamlessly
using the Signals Data API. Moreover, social network features, data science competitions and users interactions will be a key part of the Signals Platform.
Once a data set is selected, it then needs to be processed, calculated and displayed in an understandable manner. This can be done using simple indicators based on technical analysis, advanced data science indicators based on neural networks or even indicators based on prediction markets and crowd wisdom. We plan to include the following indicators in the Signals Platform:
• Basic freemium indicators – Monitor the price of a crypto asset and send signals
based on “if-then” conditions. We believe that a simple UI and the possibility to combine your basic strategy, such as ‘Stop Loss’, together with other features of the Signals Platform such as the ‘Flash crash detection system’ (more in the Strategy Builder section) would be a popular way to manage a crypto portfolio not only for experienced traders, but also for mainstream crypto exchange users.
• Technical analysis indicators – This methodology consists of using statistics applied to historical data to find patterns and trends in the market. They are very important in combination with other methods. (See: Machine Learning for Signals Extraction section)
• Sentiment analysis indicators – Using natural language processing, opinion mining (or sentiment analysis) based on media monitoring is becoming a standard tool for analysis. The Signals Platform provides sentiment analysis indicators together with data from social networks and cryptocurrency focused news. (See: Data Marketplace section)
• Machine learning based indicators – Deep learning neural networks, support vector machines, or special neural network architectures which are designed for processing time series, such as LSTM recurrent neural networks
• Crowd wisdom based indicators – In his essay, The Use of Knowledge in Society, economist Friedrich Hayek put forward that an economy is organic and prediction of it can be determined from surveying the masses. Trading related prediction markets work similarly — they enable users to monetize their unique knowledge by buying and selling shares in the outcome of an event. If they predict the outcome correctly, they profit; otherwise, they lose their money. The current price of event outcome, based on
a 1-100% probability, encapsulates and quantifies the knowledge of the crowd.
• Blockchain monitoring indicators – The transparency of a blockchain allows for analysis to be conducted on the movement of every token, especially those held by major holders, otherwise known as “whales.” When the distribution is not uniform and the majority of tokens are held by few holders, tools which monitor “whale” movements can show when major holders are buying or selling their holdings.
• Github commit indicators – We will be able to provide traders with the ability to monitor Github commits and changes so that they can immediately see all updates on coins and tokens they hold and trade.
• Custom indicators – For experienced developers and data scientists, the Signals Platform is an opportunity to monetize knowledge and skills by developing indicators which they can offer to others. These indicators can be used for free for backtesting historical data or for live trading. However, a subscription fee set by the owner of the indicator must be paid.
We believe that the best algo creators should be able to be rewarded for their work and with the Signals Strategies Marketplace. Using the Strategies Marketplace, developers and traders can list their trade strategies for copy trading and offer it to other users. In this subscription based service, users will pay for receiving trading signals from a third-party bot, which can then be traded through the platform. For new users, this is the most simple to start automated trading. For each strategy, a report is generated, in which users can check the performance, level of risk and statistics of a given strategy before they decide to start copy trading.
Third party bots integration
Even though our mission is to provide the most user-friendly and flexible tool for creating trading robots on the market, there will always be plenty of other successful trading bots which will be created outside the Signals Platform and which can be integrated into our marketplace using our API’s.
This possibility would also be very beneficial for small data science teams, which are capable of designing great algorithms for trading but have no experience with mobile development or UX design. By monetizing their signals through the Signals Marketplace, they can easily approach new customers and offer them top class strategy and analytics.
Signals Strategy Builder
With data and indicators in hand, the next step is to piece them together and create a workable strategy for trading. The Signals Strategy Builder is an easy-to-use tool that will allow users to create their own trading strategy, even with no programming skills. There are two main components to each strategy – indicators and signals. Indicators are blocks of code selected from the Indicators Marketplace. Signals, on the other hand, are actions that are triggered in response to indicators. In the Signals Strategy Builder, users drag and drop the indicators from the Indicator Marketplace and then define the conditions of the indicators under which the signals should be triggered.
The Signals Strategy Builder offers numerous features to enable the user to create optimal strategies and evaluate their performance before starting to use it for live trading.
The following are some of the main features:
• Advanced charting
• Backtesting and training with genetic algorithms – The Signals Platform provides users with a set of data science tools and advanced optimization techniques based on machine learning and evolution algorithms.
• Complex supercomputer experimentation – Machine learning based on historical data can be very demanding on CPUs. For this reason, Signals, in partnership with iExec, will connect to a worldwide decentralized supercomputer, where users can train their strategies and carry out computationally complex experiments.
• Benchmarks and risk quantification reports based on historical data – Proper analytics and model benchmarks are crucial for successful risk management. When you create and test your model, we will automatically generate feedback on how successful your strategy would be with new data, assess your strategy using standard benchmarks, and analyze the risks and possible profits.
• Adaptive strategies – Fixed strategies are not always the best choice for maximizing profits in the long term. Market trends constantly change and so should your strategies. By using advanced automated techniques such as walk-forward optimization, your strategies will continuously adapt to new circumstances on the market.
• Machine learning for signal extraction – By using deep learning and other machine learning techniques, users can rule out subjectivity and find hidden patterns between selected indicators based on historical data.
• Flash crash detection system – A deep drop of an asset’s price followed by its quick recovery is a nightmare for any trader who sets up a stop-loss order. Many traders have lost money when they set up a stop-loss on a crypto exchange and a flash crash happens. Our service monitors all major crypto exchanges, and we offer a flash crash detection system that can be used by any trading strategy which is connected directly to a crypto exchange.
• View and edit directly the code in the background – Although any strategy can be created in the Signals Strategy Builder, we’ve made it possible for experienced developers to display and edit the code which is generated in the background. Thus, we provide maximal flexibility for developers and data scientists, but at the same time, we make automated trading available for non-programmers.
Live trading and mobile notification
Connection to your crypto exchange account
After your model is backtested on historical data and ready to use, you can connect it to your crypto exchange and start trading using our cloud based solution. Even though the security of our platform is our priority, we understand that providing access to your crypto exchange account via a cloud based service is a delicate issue for many users. That is why we will provide an open source desktop app that will be able to perform automated trading in the background. With this desktop solution, traders can be absolutely sure that the access token is stored and encrypted on their device and is used only for communication with their crypto-exchange account and never disclosed anywhere else.
Mobile connection and alerts
It is also possible to create an automated strategy that is meant not directly for trading but for receiving alerts and notifications. You can connect your trading bot to your smartphone using our app. Any time that your strategy identifies a trading opportunity, you will be informed and the final decision will be up to you.
Our mobile app is especially useful together with media monitoring and sentiment analysis indicators. These kinds of data processing indicators are able to send you not only signals to buy or sell but also meta information about the data source which they processed. This enables you to easily create bots which will notify you when new trends appear so that you can keep up with the constantly changing environment of the crypto world.