How MegaTAO Works
Simple Trading System
MegaTAO makes trading simple. You deposit TAO, place a trade, and it executes instantly.
How Trading Works
Step 1: You deposit TAO into your account Step 2: You choose an Alpha token and decide if price will go up (long) or down (short) Step 3: You set your leverage (up to 3x currently) Step 4: Your trade executes instantly - no waiting Step 5: You watch your position and close when ready
Why It's Instant
The protocol always has liquidity ready. When you place a trade, it executes immediately. You don't have to wait for someone else to take the other side.
Instant Execution: Your trades fill right away
Always Available: The protocol is always ready to take your trade
Predictable Prices: You get the price you expect
Trading Without Owning Tokens
You don't need to actually own Alpha tokens to trade them. You just bet on whether the price will go up or down.
How It Works:
You deposit TAO as collateral
You open a position (long or short)
You profit or lose based on price movement
Everything is settled in TAO
Benefits:
No need to hold tokens
No transfer fees
Instant entry and exit
Simple - everything in TAO
Example:
You think Alpha Token X will go up
You deposit 10 TAO and open a 3x long position
Price goes up 20%
You make 60% profit (20% × 3x leverage)
You get paid in TAO
💎 TAO-Only Collateral
You only need TAO to trade. No other tokens needed.
Why TAO?
TAO is the native currency of Bittensor
Simple - one currency for everything
Lower fees - fewer transactions
Easy to manage
Current Limits:
Collateral Deposit Cap: There's currently a limit on how much TAO you can deposit. This limit will be removed later as the protocol grows.
Maximum Leverage: 3x (will increase later)
Note: These limits are temporary and will be expanded as the protocol matures.
🔮 Price Feeds
MegaTAO gets prices directly from Bittensor. This means:
Accurate Prices: Prices come from multiple sources to prevent manipulation
Real-Time Updates: Prices update automatically
Transparent: All prices are verifiable on-chain
Prices update:
Every few minutes automatically
When prices move significantly
In emergencies if needed
Funding Rates
You pay a small fee (or receive payment) every 8 hours for holding your position. This keeps prices fair.
How It Works:
If more people are going long, longs pay shorts
If more people are going short, shorts pay longs
This balances the market
When You Pay: Every 8 hours (midnight, 8am, 4pm UTC)
Why It Matters: Keeps prices fair and balanced
🔄 Trading Process
1. Open Position
Deposit TAO
Choose Alpha token and direction (long/short)
Set leverage (up to 3x)
Trade executes instantly
Cost: 0.5% trading fee
2. Manage Position
Watch your profit/loss
Keep margin ratio above 20%
Add or remove margin anytime
Pay funding fees every 8 hours
3. Close Position
Close anytime with market or limit order
Cost: 0.5% trading fee
If margin gets too low (<20%), position closes automatically with 5% penalty
🛡️ Safety Features
The protocol watches your position and keeps you safe:
Margin Monitoring:
Healthy (35%+): You're fine, keep trading
Caution (25-35%): Getting risky, watch closely
Danger (20-25%): Very risky! Add margin now
Liquidation (<20%): Position closes automatically with 5% penalty
Automatic Protection: If your margin gets too low, your position closes automatically to prevent bigger losses.
Warnings: You'll get warnings before liquidation so you can add margin.
Current Limits
Maximum Leverage: 3x (will increase later)
Collateral Deposit Cap: There's currently a limit on how much you can deposit. This will be removed as the protocol grows.
These limits are temporary and will be expanded over time.
Next Steps
Key Features & Benefits - What makes MegaTAO special
Network Setup - Set up your wallet
Your First Trade - Make your first trade
⚠️ Warning: Trading involves risk. Only trade what you can afford to lose.
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