Running a business around algorithms is difficult. AlphaNu’s platform resolves the most critical issues faced by algorithm developers in wanting to step into the high-potential yet untested markets in Asia, and make it easy for developers to decide if they wish to use our platform. Our all-in-one platform encompasses all the functions to allow algorithm developers to create a successful business selling algos to Asian customers.
Here’s just some of the most critical problems we have resolved through creating AlphaNu:
- Legal enforcement of proprietary rights
When a seasoned Wall Street developer wants to build algorithms for an untapped market like China and other Asian countries, they have to rely on contracts and a foreign legal system to enforce their proprietary rights. However, there are minimal protections and financially viable options for them to enforce these rights. So, although they might have very willing purchasers, these purchasers may end up reselling the algorithm in a “black market” situation. This leads to our second problem:
2. Pricing of algorithms
In order to justify the risks involved, developers markup their prices significantly, reflecting the high prices of a complete intellectual property transfer than a simple algorithm access transaction. Developers are thus pressured into making deals involving exclusive use of their algorithm or complete sales, rather than provide the algorithm sustainably for everyone to benefit from. Ideally, developers would prefer to sell continuous access to an algorithm to a large group as it would create long term income streams and allow them to grow the cashflow from one type of algorithm infinitely instead of a one-off cash purchase.
3. Safe and secure coding environment and subscription based sales model
Many developers whom we have approached are very concerned if adopting our business model will lead to risks of leaking their proprietary algorithms. Not only do we have quantum cryptography professionals on our team, we’ve created an extremely secure closed coding environment with fully featured backtesting abilities, access to data, and customer management tools for developers. It is a user friendly UI that allows each developer to analyze historical trading data which we have provided, in order to create his or her ideal trading algorithm. There are no hassles of having to separately link up with cloud computing providers such as Azure or AWS, as our platform is already linked up, providing the most efficient and secure backtesting capabilities, and no extra costs for accessing cloud computing on our platform.
After development, algorithms will be listed directly on our marketplace, where users will subscribe to utilize the algorithm through their brokerage accounts. This means that the algorithm source codes are securely encrypted, and will execute instructions directly to the brokerages — enabling huge cost savings while expanding the potential sales numbers for the developers. Effectively, we’re cutting out the hedge funds that eat up all the sales commissions and creating a transparent model for how algorithms can be democratized to be accessible to everyone.
4. Cost of Relevant Historical Data and Processing
Exchanges often charge large sums for access to critical datasets necessary for building algorithms tailored to a market. These sums range upwards of $10,000 even for widely available data in the US, and are often a huge upfront cost to think of when it comes to starting an algorithm trading consultancy or business.
The rarity and price of financial data from markets in Asia and China is even higher — exchanges in China are not privately operated and do not have profit motives to enable clean, processed, and ready-to-use data for third party use. Furthermore, the financial language used is very different from that which developers are used to in the US.
AlphaNu, through our relationships in China, have acquired access to rare and valuable historical trading data such as that of the high-volume markets for Chinese commodity futures. We have translated the data into English and reorganized into column oriented data for easy data analysis. This historical data is not easy to come by as the Chinese financial market has been mostly unaccommodating to foreigners. We know that our friends on Wall Street do not have this data, and if they do — they will not be willing to let go of it except for the right price.
AlphaNu on the other hand will be offering up controlled access to this data cheaply for developers to begin building the best algorithms possible for our target users. We will implement a token-based pricing structure that ensures developers on our platform are paying the most accessible price for the data and business they are doing on our platform. Effectively, as our platform grows and more and more sales are guaranteed, the tokenomics we have built will create a self-regulating pricing structure that needs minimal intervention on our part. Our extremely low staking requirements for data are one of our strongest selling points, and create huge value for algorithm developers to kickstart a low-cost and scalable business on AlphaNu.
5. Language barriers
It goes without saying that to do business in a country, you need to be able to communicate effectively with the locals. AlphaNu as a marketplace not only provides SaaS tools for developers and users to improve their trading experience, but also resolves the cross-border communication barriers that prevent knowledge sharing and business. Our system uses smart tags that automatically categorizes and translates each aspect of the algorithm to be understood easily by our target users, and offer strong moderation and financial language professionals to ensure that there is no misinformation in the algorithm listings.
We know that without AlphaNu, entering the Chinese market for a foreign quant developer will be a daunting and expensive process. We’re willing to spend all the necessary effort to translate every developer’s materials into Chinese and localize it for China’s domestic audience — all for free! Developers do not need to work with 3rd party translators, whom may not know financial terms and jargons, which can adversely impact the information presented for each algorithm. We believe marketing on behalf of developers is a win-win situation for everyone. The more algorithms a developer sells, the more successful AlphaNu will be.
6. Marketing Assistance
It goes without saying that there are huge marketing requirements for developers if they were to try and operate their own algorithm sales programme without AlphaNu. As we are connected to the top trading brokerages in China, we have access to a hungry user base and easy opportunities to push for AlphaNu’s algorithms directly to the end user without going through the hassle of advertising. Together with AlphaNu’s aggregated marketing campaigns and marketplace structure, we believe that we will be the only platform capable of creating rapid growth in the algorithm trading market within a short span of time.
7. Invoicing and Payment Processing
Lastly, being a cross-border product requires AlphaNu to have strong invoicing and payment processing capabilities. We are in the process of incorporating as a special entity within the Free Trade Zones in China, where we are capable of providing immediate payment processing across borders. This puts us at a special position to advance the interests of both the algorithm developers globally, as well as the target markets we have highlighted that have high growth potential. Additionally, we will be using blockchain and ledger technologies to ensure transparency, and hence, enable trust in our business as a whole.
— — — — —
To cap off, we want to emphasize that our Developer Dashboard isn’t simply a browser based IDE. It will provide tools and data to help developers manage and expand their own business, just like a seller on Amazon would. Developers will have access to data like views, time on page, conversion rates, competitor pricing, user ratings, and user feedback. Developers on the AlphaNu marketplace are in charge of their own business and we provide the tools for them to efficiently manage and expand it.
We truly believe that AlphaNu will become the premier marketplace for all things related to kickstarting the new business model in algorithm trading, where everyone in the world can benefit from and apply automated trading — and finally get a good night’s sleep. Algorithm developers will be the pioneers of this movement, and we want to make sure they are with us each and every step of the way.
