High frequency hedging of digital currency

1.

At the G20 meeting, different countries held different views on digital currency, some strongly resisted it, and some actively supervised it. Now let's take a look at the attitudes of the G20 countries towards digital currency

In a statement, the Canadian Securities Regulatory Agency (CSA) said that considering the whole process of ICO issuance, many ICO tokens meet the definition of securities and require them to comply with the securities law. In addition, the CSA noted that ICOS may also be derivatives, subject to derivatives laws passed by Canadian securities regulators, including trade reporting rules. Regulators said they welcome companies that are about to conct ICO to enter the "regulatory sandbox" to test new financial procts in a limited environment

India

the securities and Exchange Commission of India is planning guidelines for the regulation of the bitcoin market in India. In addition, the securities and Exchange Commission of India set up a financial regulatory commission and held meetings with Reserve Bank of India (RBI) officials. The SEC also plans to regulate whether bitcoin derivatives and other cryptocurrencies are used to raise funds illegally

2.

The contract transaction of digital currency is not safe. There are still many loopholes in the digital currency trading platform, for example, the most common are the following six kinds:

1. Denial of service attack

denial of service attack is the most important attack against the digital currency trading platform at present. Through denial of service attack, the attacker makes the trading platform unable to access normally, Because users can not accurately distinguish the degree of attack, it often causes panic asset transfer, which brings some loss

2. Phishing incident

even the best technical measures at present can not make the digital currency trading platform avoid phishing attacks. Some hackers and criminals can confuse digital currency investors by means of fake domain names or fake pages, while ordinary investors can't identify the authenticity, so it's easy to cause asset losses

Many digital currency trading platforms use a single private key to protect the hot wallet. If hackers can access a single private key, they can crack the hot wallet related to the private key. For example, in the attack on yapizon of Seoul stock exchange in 2017, the attackers stole hot wallets from the trading platform twice in a year, resulting in a total loss of nearly 50% of the assets of the trading platform and eventually leading to the bankruptcy of the trading platform

Fourth, e to the lack of perfect risk isolation measures, or ineffective supervision on the rights of employees, some employees who have the operation rights of the platform use internal trust to seek unjust wealth for themselves. For example, in 2016, the event of employees stealing bitcoin on shapeshift caused a total loss of US $230000 to the trading platform by stealing and reselling sensitive information to others

Fifth, the software vulnerability of digital currency trading platform includes single sign on vulnerability, OAuth protocol vulnerability and so on. At present, all countries have laws requiring banks or other financial institutions to implement information security measures to protect customers' deposits. However, e to the fact that the blockchain field is still in its infancy, there is a lack of such specifications for encrypting digital assets. Therefore, it is not accidental that many trading platforms have a large number of loopholes in the absence of security constraints

6. Transaction malleability the technical supporters of blockchain often think that blockchain transactions are highly secure because they are recorded on records that are said to be unchangeable, but each transaction needs to have a corresponding signature, and the records can be forged temporarily before the final confirmation of the transaction

extended data:

rules of contract transaction

1. Transaction time

contract transaction is 7 * 24 hours transaction, which will be interrupted only ring the settlement or delivery period of 16:00 (UTC + 8) every Friday. In the last 10 minutes before delivery, the contract can only be closed, not opened

Transaction types are divided into two types, opening and closing. Opening and closing positions are divided into two directions: buying and selling:

buying open long (bullish) refers to buying a certain number of contracts when users are bullish and bullish on the index. Carry out "buy open more" operation, match success will increase long position

selling pingo (multi order closing) refers to the selling contract that the user makes up for when he is no longer bullish on the future index, offsets with the current buying contract and exits the market. Carry on "sell flat much" operation, match after success, will rece long position

short selling (bearish) refers to the new sale of a certain number of certain contracts when the user is short or bearish on the index. Carry out the operation of "sell short" and increase the short position after successful matching

buy close (short single close) refers to the buy contract that the user will not be bearish on the future index market and make up for, offset with the current sell contract and exit the market. Carry out "buy short" operation, after matching successfully, short position will be reced

3. Order method

limit order: the user needs to specify the price and quantity of the order. Limit order can be used for opening and closing positions

order at opposite price: if you choose to order at opposite price, you can only enter the order quantity, not the order price. The system will read the latest competitor price at the moment of receiving the entrustment (if the user buys, the competitor price is the selling price of 1); If it is a sell, then the counter price is buy 1 price). Issue a price limit order for this counter price

4. Position

the user owns the position after opening and trading, and the positions in the same direction of the same contract will be merged. In a contract account, there can only be 6 positions at most, that is, multiple positions of current week contract, short positions of current week contract, multiple positions of next week contract, short positions of next week contract, multiple positions of quarterly contract and short positions of quarterly contract

5. Order restriction

the platform will restrict the number of single user's positions in a certain period of contract and the number of single open / close positions, so as to prevent users from manipulating the market

when the number of positions or entrustments of users is too large, the platform has the right to require users to take risk control measures, including but not limited to cancellation of orders, closing positions, etc. The platform has the right to adopt measures including but not limited to limiting the total number of positions, limiting the total number of consignments, limiting the opening of positions, withdrawing orders, forcibly closing positions, etc. for risk control

3. There is no doubt that bitcoin is the best target, and some platform currencies have investment value, such as okb. Don't forget to adopt it

4. Mining with a graphics card, not the CPU

5. If the property is cheated, it is necessary to report to the public security organ in time. The public security organ determines the nature of the case after examination. For those who meet the conditions of filing a case, it is necessary to obtain evidence by means of investigation to solve the case, so as to recover the loss of the victim
legal basis:
166th proceres for the handling of cases by public security organs. The public security organs should give immediate acceptance to citizens for the transfer, reporting, accusation, reporting or criminal suspect's automatic surrender, inquire about the situation, and make notes. After checking correctly, the signers, the complainants, the accusers, the informants, and the automatic surrendered persons will sign their names. Print your finger. When necessary, it shall be recorded or videotaped
Article 174 if, after examination, administrative punishment is not enough for criminal punishment, it shall be dealt with in accordance with the law or transferred to relevant departments
Article 175 after accepting a case, if a public security organ, upon examination, considers that there are facts of a crime that need to be investigated for criminal responsibility and that the case belongs to its own jurisdiction, it shall file the case with the approval of the person in charge of the public security organ at or above the county level; If a person considers that there is no criminal fact, or that the criminal fact is obviously minor and does not need to be investigated for criminal responsibility, or that there are other circumstances in which criminal responsibility is not investigated according to law, the case shall not be filed with the approval of the person in charge of the public security organ at or above the county level
if the public security organ decides not to file a case with a accuser, it shall make a notice of not filing the case and deliver it to the accuser within three days
187th, the public security organs should investigate the criminal cases that have been registered in time, collect and obtain evidence materials of the suspect's guilt or innocence, light offense or heavy crime.

6. Any market can achieve high-frequency trading, but the high-frequency trading cost requires hardware support such as bandwidth server, as well as algorithms for different markets and different periods. Arbitrage trading is really suitable for digital currency, and now the well-known strategy is hummingbird strategy (HMT. One).

7. The market has graally improved, arbitrage is not as easy as before. For this kind of arbitrage software, it is either very expensive or deceptive
because of the rapid development of virtual money market, arbitrage is very difficult.

8. The central bank has issued an early notice that digital currencies are illegal and are not allowed to open trading platforms. The original ones have been shut down. Those who have not closed their business have turned their business overseas to earn money from foreigners.