Event recap: TRUMP token and Trump's dinner
Recently, holders of the TRUMP token became the focus of the cryptocurrency community. According to the event rules, TRUMP token holders have the opportunity to attend a dinner hosted by Trump, but participation requires meeting certain token holding requirements. However, a holder named Morten Christensen revealed an astonishing fact: he and four friends, through a unique trading strategy, actually participated in this dinner for almost 'free'.
Brilliant trading strategy: Hedging and arbitrage
Morten Christensen and his friends successfully minimized the actual cost of participating in Trump's dinner through a clever trading strategy. Their strategy was to buy TRUMP tokens while shorting the exact same amount. The core of this strategy lies in hedging risks, offsetting the risks of token price increases or decreases through shorting, ensuring that their position value would not change significantly regardless of market fluctuations.
The specific operation is as follows:
1. Buy and short the TRUMP token: Christensen and his friends bought TRUMP tokens during the event and simultaneously shorted the same amount of tokens. This way, regardless of whether the token price goes up or down, their position value would not be significantly affected.
2. Wait for the event results: During the event, they maintained this hedged position until the event results were announced.
3. Close positions and profit: After the event results were announced, they immediately sold the TRUMP tokens in hand and closed out the short positions. Since the value of their holdings remained largely unchanged during the event, the actual amount spent was mainly just trading fees.
Actual cost was merely trading fees: Almost 'free'
According to Christensen, each of them only spent about $1200, mainly for trading fees. The brilliance of this strategy lies in their exploitation of the loophole in the event rules, allowing them to almost 'freely' gain the opportunity to attend Trump's dinner through hedging trades. In contrast, other participants might need to spend tens of thousands of dollars to meet the event's holding requirements.
Insights from the incident
This incident provides us with some important insights:
1. The power of hedging: Christensen and his friends successfully hedged market risks by buying and shorting the same amount of tokens. This strategy is commonly used in traditional financial markets, but in the cryptocurrency market, due to its high volatility, the effects of hedging trades may be even more significant.
2. Loophole in event rules: This incident also exposed potential loopholes in the event rules. The event organizers may not have considered that participants could hedge their trades to avoid risks, leading to this possibility of 'low-cost' participation.
3. The intelligence of investors: Christensen and his friends demonstrated the intelligence of investors when facing complex markets and event rules. Through clever trading strategies, they achieved their goals while providing new ideas for other investors.
Conclusion
Morten Christensen and his friends successfully minimized the actual cost of participating in Trump's dinner through brilliant trading strategies, almost achieving 'free' participation. This incident not only showcases the power of hedging trades but also reminds event organizers to be more cautious when designing rules.
If you are interested in this trading strategy or have other opinions, feel free to like and reply, and let's explore more possibilities in the cryptocurrency market together!