HEDGE

Short Token is a term for crypto assets that are traded in the futures market, where when the price of the asset drops, the trader can still make a profit. This is because in the world of the futures market, traders can put a number or price below the current price, and make a profit when the price hits that number!

Currently, Short Tokens such as Short Bitcoin Tokens or HEDGE and Short Ethereum Tokens or ETHHEDGE can be traded on the spot market, such as Indodax. But, how does it work? Isn’t it in the spot market, we can only make a profit when the price goes up?

Well, here’s what makes it unique! HEDGE and ETHHEDGE have price movements that are opposite or inversely proportional to the price movements of Bitcoin or Ethereum. So, if the price of Bitcoin or Ethereum is going down, traders can still get profit by having HEDGE or ETHHEDGE, because it means the price of HEDGE or ETHHEDGE price is going up. Interesting, right?

Discussing a little history, Short Bitcoin Token or HEDGE is an ERC20 token that was launched in 2019 and operates on the Ethereum blockchain. HEDGE is a derivative token of Bitcoin and its price movements tend to be opposite to Bitcoin price movements. With this, traders can take advantage of the benefits of 1x Short Bitcoin Token or HEDGE when there is a decrease in the price of Bitcoin, you know!

For example, the current Bitcoin price is at 500 million Rupiah and the HEDGE price is 3 million Rupiah. Then, there was a 5 percent price drop in Bitcoin, bringing the price to 475 million Rupiah. However, what happened to HEDGE was an increase in price of 4.7 percent, so that the price of HEDGE became Rp. 3,141,000 (three million one hundred and forty one thousand Rupiah).

Vice versa, when for example there is a 3 percent price increase on Bitcoin, there will be a price decrease of approximately 3 percent on HEDGE.

Next, the Short Ethereum Token or ETHHEDGE which is a derivative token from Ethereum. The movement of ETHHEDGE tends to be opposite to the movement of the price of Ethereum. So, traders can take advantage of the advantages of ETHHEDGE when there is a decline in the price of Ethereum.

For example, the price of Ethereum is currently at 50 million Rupiah and the ETHHEDGE price is 100 thousand Rupiah. Then, there was a 10 percent price increase on Ethereum, bringing the price of Ethereum to 55 million Rupiah. However, what happened to ETHHEDGE was a price drop of 8.3 percent, bringing the price of ETHHEDGE to Rp. 91,700 (ninety one thousand seven hundred Rupiah).

Vice versa, when for example there is a price decrease of 1 percent on Ethereum, there will be a price increase of approximately 1 percent on ETHHEDGE. How? Very cool, yes!

Well, this Short Token is very useful for traders to be able to manage risk and act as a protector that prevents large losses, especially when the crypto climate is unstable. In addition, Short Tokens can help in managing margins.

Oh yes, because traders can buy HEDGE and ETHHEDGE like other ERC20 tokens on the spot market, such as Indodax, traders don’t need to manage collateral, margin, or liquidation prices like in the futures market.