a good explanation for some people can be found here. http://www.investopedia.com/terms/h/hedge.asp
These are really limited due to the fact its basically shorting XPY for the purpose of us trying to create a protection of sorts for new or current investors. It was started as a pilot to see if this would be something someone is interested in. So far most people are just confused. So maybe the financial move is probably a little to confusing. Ultimately the Goal of this program is to try to create hopefully winning situations for investors into crypto... or at minimum create limited downside propositions.
Ok, I think I get the idea but if I wanted to gamble on XPY value I would likely do better just by buying it on Cryptsy or 'trex.
Or perhaps it's just worded backwards. There should be a way to phrase it to make sense because now it sounds like a horrible deal either way.
If you buy them off cryptsy.. and the price tanks... then you loose far more then 10 percent. Thats the point of the hedge. But i agree that im sure we could word it better.
Are you aware that this would technically class a security by holding other peoples Coins? Funds held within the system would need to also be backed and can be liable for their loss, any misappropriation of funds held within xpy.io could be subject to securities fraud.
Completely agree. If the funds are handled inappropriately or not above board it would be unacceptable and fraudulent. They incorporated this through Hong Kong so i don't believe its subject to US security laws.
Wouldn't it just be easier not to hold customer funds?