On August 26th, 2024 at 4pm UTC, the first Omni trading competition officially came to an end after two weeks of testnet trading. This article describes how the trading competition went, and dives into observations about some of the strategies used by the winners.

Highlights

• 1,303 peak daily active traders

• 1,948 total competitors

• 99.5M total Test USDC claimed from faucet

How did it work?

The competition was open to all users (except Restricted Persons) and took place on the Omni testnet. At the beginning of the competition, all user positions and Test USDC balances were wiped. Users could claim 10k Test USDC daily from the faucet, which could then be used to trade and generate profits (or losses) on Omni.

The competition was tracked through a leaderboard in the Variational Docs, which was updated daily to show a ranking of competitors by PnLs.

Who won?

There were 5 winners who split a prize pool of 2,000 USDC, 100 winners who received a top 100 NFT, and 1803 users who claimed from the faucet more than once and received a participation NFT.

Let’s dig into the top 5 competitors’ strategies:

1st: This competitor shorted major tokens ($SOL, $ETH, $WBNB) and caught a major market downturn.

2nd: This competitor ran a high-frequency trading (HFT) style strategy that attempted to take advantage of near-term price movements by looking for favorable entry prices from OLP and holding for short periods of time.

3rd: This competitor stuck to momentum trading a couple assets that (we assume) they were familiar with: $TIA, $AAVE, and $LISTA.

4th: This competitor started out by exclusively trading $BTC with relatively small size, and eventually legged into $SOL and $ACE in larger size for more risky plays towards the end of the competition.

5th: This competitor exclusively traded $ETH for the duration of the competition, starting with longs and transitioning to shorts based upon market timing.

What did we learn?

Overall, the trading competition was extremely valuable to the development of Omni. This was the first time that users had motivation to maximize their PnL on the platform, which resulted in significantly different user behavior than on the pre-competition testnet.

Despite trading behavior being closer to what we expect on mainnet, there were still some strange behaviors that would be impractical or unprofitable in a real-money environment. For example, some user(s) attempted to win the competition by creating lots of new accounts and skewing the funding rate on certain assets. This strategy was caught quickly by our team during the competition, and would be unprofitable with real money.

Some notable takeaways:

• Everyone wants take-profit and stop-loss orders. TP/SL was widely requested throughout the competition, and has now been implemented and tested internally. It will be deployed on  testnet before the next competition.

• Dynamic leverage was heavily requested. Traders want to be able to increase or decrease their leverage based on the underlying asset they’re trading. This is currently being implemented and should land on testnet shortly.

• People want better docs. In order for Omni to be as retail-friendly as possible, we’ll need granular explanations of as many terms and mechanisms as possible. More elaborate documentation is now in the works!

Conclusion

Overall, the trading competition was a resounding success. It drove the Omni testnet to see its highest user counts thus far, and revealed a number of additional features and improvements that could be implemented based upon community feedback.

Because the first competition went so well, we’re planning to host another one before we launch our  mainnet! The second competition is currently scheduled to take place once TP/SL has been implemented. Make sure you’re following Variational on Twitter and are in the Variational Discord to know when the next one starts!