One Month Down (or Up)

Reflecting on Progress
Today marks the completion of the first month in the 12-month challenge. In our Week 2 Update, we reported that the average returns of TrendBot 2.0, MarginBot 2.0, and Margin10 (Trend Token) slightly underperformed the altcoin benchmark (Total2, the crypto market cap excluding Bitcoin), achieving 21.5% compared to Total2's 21.72% and Bitcoin's 24.42%.

At that time, Bitcoin’s sharp rise toward $100k indicated increasing BTC dominance, signaling that altcoin season had not yet begun. Over the past two weeks, however, Bitcoin gained 10.9% while Total2 surged 27.7%, a shift suggesting that altcoin season may be emerging. While two weeks of outperformance alone don’t confirm altcoin season, it’s an encouraging sign as we head into 2025—a post-Bitcoin-halving year where altcoins often thrive during Bitcoin's cooling phases, as profits rotate into smaller coins.

But enough about benchmarks. The real question is: How did TrendBot 2.0, MarginBot 2.0, and Margin10 perform?

 

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Performance Overview

Over the past two weeks, while Bitcoin rose 10.9% and Total2 gained 27.7%, the average of TrendBot 2.0, MarginBot 2.0, and Margin10 soared by 42%, bringing their combined total returns for the first month to an impressive 72.5%. Here’s the performance breakdown:

 

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Insights on Strategy and Differences

Each bot utilizes the dual-momentum trading system to manage portfolios of top cryptocurrencies. However, differences in leverage and coin selection significantly impact performance:

• Leverage Differences:
  • MarginBot 2.0 employs up to 2x leverage, enabling higher returns during uptrends.
  • Margin10 (Trend Token) is currently capped at 1.3x leverage, with the potential to scale higher at a future date.
  • TrendBot 2.0, operating on Binance Spot accounts, uses no leverage, maintaining a 1.0x exposure.
• Coin Selection Differences:
  • TrendBot 2.0 has the widest coin selection, accessing a broad range of cryptocurrencies available on Binance Spot.
  • MarginBot 2.0 has a more limited selection, focusing on higher-volume coins available on Binance Margin.
  • Margin10 is the most selective due to requirements such as having a price oracle feed from Chainlink and, preferably, a market on Venus for collateral. Nonetheless, Margin10 focuses on the top 10 coins by volume on Binance, ensuring access to the most liquid and prominent assets.

These differences in leverage and coin selection account for the varying performances across the bots.

 

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Portfolio-Specific Results

Here’s a detailed breakdown of each portfolio’s performance over the first four weeks:

 

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Market Overheating and Adjustments

Both MarginBot and Margin10 reduced their leverage during the past two weeks as the "extreme uptrend" condition in the dual-momentum strategy indicated market overheating. This adjustment minimizes risk during periods of heightened volatility. Should the market cool in the coming weeks, these bots are expected to reapply leverage, potentially enhancing returns.

For example, the bots dynamically adjust leverage as follows:

• Downtrend: No leverage
• Weak uptrend: Some leverage
• Strong uptrend: Max leverage
• Extreme uptrend: Minimal or no leverage

Currently, MarginBot is borrowing only 10% USDT, providing light leveraged exposure to its portfolio.

 

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Untracked Portfolios: Additional Insights

While the portfolios tracked in this challenge performed exceptionally, the remaining untracked Tradeium portfolios delivered even more remarkable results over the same period:

These portfolios achieved an average return of 123.75%, outperforming both the tracked portfolios and market benchmarks (Bitcoin: 38%, Total2: 55.5%). While their performance is impressive, I believe in adhering to the predetermined portfolios for this challenge to maintain consistency. Historical backtesting indicates that switching portfolios based on short-term performance is rarely effective.

 

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A Promising Start

The first month has been exceptional, with a 72.5% gain, turning the initial $100k into $172.5k. While such rapid gains are unlikely every month, they provide a strong foundation for the journey ahead. Even achieving half these gains on average for the remaining 11 months would comfortably reach the $1M goal.

The journey has just begun, and while there will undoubtedly be ups and downs, this first month’s success demonstrates the strength of the system. Thank you for following along—stay tuned for more updates as we progress toward the $1M goal!