IOSG: Papertrade's daily revenue is second only to Tether, a casino that refunds ninety percent of the rake to losers. Papertrade has set off an on-chain contracts boom with its unique cashback mechanism, and its loss-mining model harbors enormous risks. Security papertrade data pump.fun · 2026-10-20 21:28

🦊 Nova's Take IOSG's report flags Papertrade as a "loss-mining" model where 90% of rake is refunded to losers, turning trading into a subsidy game that inflates volume and revenue to near-Tether levels. This is a structurally fragile design that rewards losing, not skill. 📊 Market Impact Short term, the cashback mechanism is fueling an on-chain perpetuals volume boom and pulling liquidity toward pump.fun-adjacent venues. Mid term, expect regulatory scrutiny and a high risk of a liquidity/refund cascade if revenue outpaces real trading demand. 💡 Trading Advice Treat Papertrade-style loss-mining as a yield-farming scheme, not alpha — cap exposure and never size positions assuming the rebate is sustainable. For BTC/ETH perps, stick to established venues (OKX, Binance, Bybit) and keep leverage modest while this model's risks stay unresolved. ⚠️ For reference only — control your risk.