Trade.io is a project by a team of experienced professionals. It is primarily an exchange, but offer more cryptocurrency services, such as consulting and ICOs. This is an advantage because it attracts some of the best projects in the crypto space to the exchange. Investors can earn a share of the profits of Trade.io as passive income by participating in the liquidity pool.
Learn more: What is passive income?
What is the Trade.io’s liquidity pool?
The liquidity pool (LP) is a pool of capital used to facilitate the works of the exchange such as lending to margin traders and providing liquidity. These operations are designed to make a profit.
Trade.io has its own token called the Tio. These tokens when staked participate in the liquidity pool’s profits. This pool earns a share from the following streams of revenue that Trade.io has.
- Consulting Services/Angel Investor
- Exchange Fees
- OTC market
- FX platform (Still to be launched)
- Airdrops from ICOs (Start Date, TBD)
The LP started on the 9th of October 2018.
Can your funds be lost when participating in the liquidity pool?
Yes, however, Trade.io have 2 backstop systems in case the liquidity pool makes a loss. The first is Trade.io’s balance sheet and the second is 50 million TIO. The 50 million TIOs do not have a claim on the revenue share, which is a great benefit for the rest of the TIO token holders. Any losses will be absorbed, but not written off by these pools of money. These losses need to be paid back via the profits.
How to join the Trade.io liquidity pool?
Investors need at least 2,500 to participate in the LP. The more TIOs are staked the better the reward ratio.TIOs can be bought on Trade.io. Investors from the USA cannot participate in the pool.
Only TIOs are accepted in the liquidity pool. There is no limit to how many investors can join the LP, but the amount of TIOs in circulation is limited. Investors can stake their tokens and they will participate in each 24-hour distribution cycle.
Learn more: How to create passive income?
Passive Income Payouts
Investors will earn payouts daily in the currency the profit has been made, these will be automatically credited to the investors account on the exchange asset balances. However, the platform has the right to pay out in any currency it wants.
Learn more: The pros and cons of passive income.
Exit from the LP
All the TIO deposited can be later withdrawn as TIOs whatever happens to the TIO price.
Trade.io the exchange, has very tough competition. New crypto exchanges are popping up every day. BAKKT and Fidelity announced they will launch a crypto exchange. These are 600-pound gorillas, which will gobble up market share from the small players mercilessly.
The tougher the competition the lower the profit margins will be. Trade.io’s strategy is to provide value-added services which can attract good projects with good teams to the exchange, a service which most exchanges do not provide.
The liquidity pool can suffer potential losses, but there are good systems in place to mitigate this risk.
Exchanges have been hacked in the past and funds lost, this would damage the reputation of the exchange and reduce future passive income to the TIO stakers.
There are other exchanges who offer similar revenue sharing models.
The passive income ROI is unclear at this stage, it is still very early days and it has only been a month since the exchange has been launched.
More info can be found here: