Why we invested in Cope

Introduction

As the crypto ecosystem has exploded in popularity, there are new projects every day, podcasts, research reports, data analysis tools, Substacks, and Telegram groups all spewing information like a fire hose. Twitter has emerged as the leading platform for seeking alpha in the crypto ecosystem. The importance of Twitter to crypto cannot be overstated; many careers have been made, projects launched/discovered, partnerships formed, and trends catalyzed by crypto Twitter. However, it still remains difficult to separate the signal from the noise and follower count alone does not correlate with the quality of the user’s insights (especially because shitposting tends to yield more engagement). Cope changes this by offering the ultimate signal filter. In its simplest form, Cope is a way to measure the quality of a Twitter user’s “market calls”, and makes it as easy as possible to deploy your capital behind these Twitter users.

Twitter is the platform of choice for crypto industry.
  • Organically growing grassroots community
  • Viral adoption is inherent to the protocol’s design
  • Sound tokenomics ensure supply decreases as Cope utility and adoption increase
  • Positioned to thrive as social media influence and financial advice continue to converge
  • Highly engaged, the fast-moving founding team

Products

  • Cope Score - Quantitative performance measurement of market calls made by Twitter accounts
  • Cope Leader Board - Ranking of Twitter-based call makers
  • Cope trading pools - Bot-operated decentralized trading pools that copy trade top call makers
  • Cope Index - An Index of twenty tokens selected based on the recommendations of the top 100 call makers, rebalanced every 48 hours

Cope score

Cope Scores range from 0 to 1000, but start at 400, and represent a quantitative metric used to measure the accuracy of Twitter accounts market calls. Once a Cope report is generated, Twitter bots begin crawling the account and monitoring all subsequent tweets. Every two weeks the system will adjust the Cope Score of all accounts based on the quality of their market calls. The Cope Score utilizes the following variables to evaluate performance:

  • Most crucial to the formula is the return on investment (ROI) — If you followed this advice ROI would be what your return would be. Based on a historical analysis of the call maker’s calls — an investment timeframe is associated with the account (could be 1 min scalping, 5-hour momentum trades, or month/year-long thesis-driven trades). This timeframe variable creates the period, starting at the moment of the call, for which the direction and size of the market price change will be used to calculate the ROI of the call.
  • This factor is used as a proxy for a user’s authority. A good call from an account with lots of followers is of more interest to the community and thus it will have a bigger impact on their score than the same call from a smaller account. However, this works both ways, as they will also be more heavily penalized for bad calls than smaller accounts.
  • A spike in trading volume often comes with increased volatility and uncertainty, call makers are rewarded more for making the right calls on days with heightened trading activity, and conversely, they are penalized more for making the wrong calls on those days.
COPE flow

Examples of Twitter market calls

Using data analysis bots to crawl through Twitter accounts, Cope generates an ongoing Cope Score that quantifies the performance and accuracy of a Twitter user’s market calls. Examples:

  • Recommends new projects that go on to 10X:
https://twitter.com/scupytrooples/status/1284847048559230982?s=20
  • Calls the bottom/top of a token, at the actual bottom/top:
https://twitter.com/tayvano_/status/1379879536377036803?s=20
  • Criticizes projects that end up declining in value:
https://twitter.com/novogratz/status/948901960132038656?s=20
  • Recommends new projects that go on to decline in value
  • Makes inaccurate top/bottom calls
  • Criticizes projects that go on to 5X

Cope trading pools

Cope Trading pools offer a passive way to copy the trades of any call maker on the Cope Leaderboard. While in the past you might have used tweet notifications to quickly trade the latest call from your favorite account, Cope Trading Pools automates this in a very elegant manner. Simply deposit USDC into your favorite call maker’s non-custodial trading pool and the bot will trade into whatever asset was most recently recommended by the call maker. As new calls are made, your assets move and are adjusted accordingly. Profits are automatically harvested every 48 hours:

  • 65% of profits are returned to the investor
  • 20% of profits go to the call makers wallet
  • 10% of profits are will be used to buy and burn Cope
  • 5% go to the community grants program (Decided by Cope holders)

Cope index

Going beyond pointing you towards the best Twitter accounts to follow or deploy capital behind, Cope is building a dynamic index of 20 tokens based on the calls made by the Cope Leaderboard. The Cope Index provides a low maintenance option for allocating capital into a diverse set of tokens determined by the Cope Leaderboard call makers. Tokens included in the index are subject to reasonably strict eligibility requirements including average market cap/trading volume over the last 30 days, liquidity, and an active USDC trading pair on the Serum Dex. The index will be rebalanced every few days to provide adequate time for the call makers’ calls to take place.

  • 80% of profits are returned to the investor
  • 15% of profits are will be used to buy and burn Cope
  • 5% go to the community grants program (Decided by Cope holders)

Token Supply Sinks

Attractive burn schedule
  • 15% of profits from the Cope index will be used to buy and burn Cope every 48 hours.
  • 0.5% withdrawal fee is applied to the Cope Index, this we will be used to buy and burn Cope.
  • 10% of profits from Cope trading pools will be used to buy and burn Cope every 48 hours.
  • To unlock your Cope report or others, it cost 10 Cope. 75% of this Cope will be burned.
  • To unlock unlimited Cope reports a user must stake 1000 Cope LP tokens (LP tokens can be for Cope/Sol, Cope/USDC, or Cope/Ray).
  • The SPL token distributor can also be used by third-party projects for a 200 Cope fee which will then be burned.
Supply schedule

Team

The people behind Cope exhibit some of our favorite founder qualities; Cyrii and the team are hustlers with extensive crypto development experience.

Community

In the open-source decentralized ecosystem, where projects can be forked with the click of a button, a project’s community becomes their most important competitive moat. Right away it was clear that the Cope Community demonstrated an impressive level of interest and engagement.

influencer validation + monetary incentive for activation = viral adoption

Crypto twitter Influencers with good Cope scores will be sure to share their scores with their followers as a form of validation, the same way many people share PnL leaderboards or screenshots of their successful trades. The Cope report is the most legitimate assessment of the advice they give to their followers. Awareness for the project to spread as Twitter influencers with good scores will organically be motivated to share their Cope reports with their followers. Major accounts will face mounting social pressure from their followers and competitors to publish their scores. This cycle will continue to feed adoption, awareness, and the social importance of a Cope Report and Leaderboard.

  1. Make Crypto market calls on Twitter
  2. Unlock Cope Report to earn rewards on calls
  3. Share Cope report/ Cope trading pool on Twitter for validation and to earn fees
  4. Drive more usage and awareness of $COPE
  5. Cope demand increases

The rise of trader influencers

Gen Z and millennials are not getting their financial advice from their parent’s advisors — and why should they? Most “Trusted” advisors have adamantly “protected” their clients from the best-performing asset of the last decade; bitcoin/crypto. Grassroots online communities, anti-establishment sentiment, and viral social media have converged in a perfect storm to give rise to a new bread of financial advisors that for the first time in history has real market impacts. While in a lot of ways this is a good thing — decentralizing the source of financial advice — there are obvious concerns about the quality of that advice especially when it comes from people without credentials/experience, or qualifications. If this is to be the future of the way people invest, it is imperative we measure what’s going on and hold these call makers accountable. Cope brings transparency and accountability to people who make investment advice, not only to flag those who have made bad calls in the past but to highlight those who are the most consistent and accurate. This seems so intuitive that we should be able to compare financial advisors by their performance, however, if you try to research the performance history for most financial advisors or even wall street analysis it would be nearly impossible to find anything substantive.

Cope community building in China with Sino

Sino Global Capital looks for projects that we can add strategic value to by enabling their success in the mainland China market. Sino has a China community/marketing expert who is 100% dedicated to helping our portfolio companies thrive in China. To start, we created a Cope China WeChat group that now has 285 members, and we share project updates such as the cope tokenomics — that we had translated into Mandarin. Going forward we are going to collaborate with local crypto communities and media companies to spread awareness and engagement in the China crypto ecosystem for Cope.

Key risks and threats

Early. Cope hasn’t launched yet. So while the community, team, and adoption strategy prove to be set up for success, the real test will be whether they can deliver on their roadmap and launch a product that works in production.

  • This attack is difficult to pull off because it not only requires multiple accounts (10+) with significant followers but because over time the opposite calls begin to cancel each other out. Some days Account 1 will be wrong and Account 2 will be right, other days Account 2 will be wrong and Account 1 right, with additional accounts this scheme can last a bit longer but over time it will follow this logic and have good/bad call days.
  • If there are accounts that are counter-trading each other over a long period, the Cope engine can be trained to spot this as potentially belonging to the same person — and thus their account can be penalized for this.
  • The Cope twitter crawlers capture all tweets as soon as they are posted and stored. If a call is then deleted later on Twitter, Cope will still record it so the call maker will be held accountable and penalized further for this bad faith behavior.
  • As it turns out, Cope will be using FTX’s data feed, one of the fastest available, so the only thing that will matter is when they make their call and what happens after.
  • The Cope engine will be able to recognize if account A is consistently posting the same call as account B just a few seconds later and they will be scored down.
  • The Cope score is designed to disincentivize front-running. Front-running will result in diminished ROI which will directly affect their Cope score. While it is likely some people will employ clever strategies to try to get away with this, the Cope protocol can implement measures such as issuing a “front-running detected notice” — and if repeated, discontinue the accounts trading pool. This will carry a significant reputational penalty for the frontrunner, likely creating a district amongst their followers.

Conclusion

As social media influence and financial advice continue to converge, Cope provides the critical infrastructure to support both holding call makers accountable and deploying your capital behind these call makers. The stellar team, grassroots community, sound token economics, built-in natural viral adoption, all set the Cope protocol up to succeed.

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Sino Global Capital

Sino Global Capital

1.5K Followers

A team of former consulting, Wall Street, private equity, government, and corporate veterans accelerating the blockchain revolution