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Introducing our new fee structure for bot creators
Onboarding
November 3, 2022

Introducing our new fee structure for bot creators

Bot creators can earn revenue by placing their trading strategies on the BOTS platform. The fee structure for each trading strategy depends on several factors. This article explain all.

Bot Creator Fee Structure

Bot creators can earn revenue by placing their trading strategies on the BOTS platform. The fee structure for each trading strategy depends on several factors, including performance, trade frequency and trade volume. Fees calculations are based on the term "basis point", which is defined as 0.01% of a given value. There are two types of fees that bot creators make money from: transaction fees and performance fees.

Total Fee

In the new fee structure, our starting point is the total fee. This fee is taken from each trade that is executed by the Trading Strategy. The total fee starts at 20 basis points per transaction, but depending on the number of times a bot trades per month, it could go as low as 6 basis points. The three fees that make up the total are the bot creator fee, performance pool fee, and BOTS/ exchange fee.

  • The total fee per trade will be 20 basis points for trading strategies (bots) that execute fewer than 2 trades per month.
  • If a trading strategy executes between 2 to 10 trades per month, the total fee will be 19 basis points for every executed trade.
  • If a trading strategy executes 10-30 trades/month, the total fee will be 14 basis points per each trade executed.
  • If a trading strategy executes more than 30 trades in one month, the total fee will be 6 bps for each executed trade.

Let's break this down. How does BOTS distribute the total fee after each trade? So, if your bot is classified as:

Less than two trades per month, the total fee is split up into three:

As the bot creator, you receive 2 basis points from each trade.

Furthermore, 3 additional basis points from the total fee are immediately sent to the Performance Pool.

The remaining 15 bps go to BOTS/exchange.

From 2 to 10 trades:

3 bps go to you as the bot creator immediately after each trade. 

Another 3 bps are sent to the Performance Pool.

And BOTS/exchange earns 13 bps.

From 10 to 30 trades per month:

3 bps are for a bot creator.

3 bps are sent to the Performance Pool..

The remaining 8 bps go to BOTS/exchange. 

30+ trades:

The bot creator earns 2bps. 

The Performance Pool receives 2bps.

BOTS/exchange earns the remaining 2bps.

Therefore, the bot’s monthly total fees will be:

Less than 2 trades/ month category:

  • 1 trade * 20 bps = 20 bps

From 2 to 10 trades, the scenarios can be the following:

  • 2 trades * 19 bps = 38 bps
  • 3 trades * 19 bps = 57 bps
  • Continue similarly for the remaining number of trades.

From 10 to 30 trades, the scenarios can be the following:

  • 10 trades * 14 bps = 140 bps
  • 11 trades * 14 bps = 154 bps

If you make more than 30 trades in one month, the following scenarios could happen:

  • 30 trades * 6 bps = 186 bps
  • 31 trades * 6 bps = 192 bps
  • You get the idea.

Bot Creators can receive big discounts on the total fees and also make use of smaller movements in the markets since it is possible to get a 70% discount on total fees (from 20 bps to 6 bps) if your bots do more than 30 rotations per month. To fairness, our platform now has fewer fees and a more democratic performance pool distribution for Bots that are profitable and consistent.

Half-Year Performance Pool

As mentioned earlier, a portion of each trade's total fee goes straight to the performance pool. This is yet another source of revenue that we have established for bot creators, so they can earn even more money. BOTS uses the following metrics to calculate performance (ratio): ROI, Drawdown, Jensen’s Alpha, and RAROC. Performance is then measured over six months ("measurement period"). Bots that enter the platform and trade for 6 months or outperform within a shorter period of time are eligible to be part of the performance pool. The top 50 bots at the end of each 6 months will receive a portion of the redistributed performance pool.

The Half-Year Performance Rank was designed to incentivize bot creators to maintain consistent results for their trading strategies over a longer period of time. Previously, the performance pool was monthly, so consistently successful bots were not necessarily prized each month. At BOTS, we love to see consistent long-term results and this new approach will allow us to reward those that have the best performance while also taking into account risk-adjusted returns.

Transition to the Half-Year Performance Pool is due on January 1st, 2023.

Conclusion

Overall, the new fee structure at BOTS is designed to reward bot creators who are able to maintain consistent and profitable results over time. Bot creators can earn additional revenue from the performance pool, as well as benefit from discounted total fees based on their trading volume. Additionally, bots will be assessed using various performance metrics such as ROI, Drawdown, Jensen's Alpha, and RAROC. We believe that this new approach will help to promote quality trading strategies and foster a thriving community of bot creators on our platform. So if you're looking for an opportunity to build and monetize your own trading bots, BOTS is definitely worth checking out!

These new features are connected to our new terms and conditions which you can find below.

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