What is Dip Hunter, and how to invest?
Written by Tracy Chen
Updated at July 6th, 2023
For the digital asset investors, deciding when and at which price to buy BTC can be very time-consuming. If you are worried about missing a good price to buy BTC but are too busy to keep your eyes on the ever-changing price chart, Dip Hunter could be your good friend. Dip Hunter, based on an established investment strategy, helps you purchase BTC at your ideal price with a discount. When you purchase Dip Hunter, you can choose your Expiry Date, Linked Price, and Discount. When the product expires, you’ll be able to purchase BTC at either the discounted Settlement Price or the discounted Linked Price, depending on how the two prices compare with each other. You could purchase Dip Hunter in either USDC or USDT, and will receive BTC in return.
Investment Currency is the currency in which the investment will be made into the product. For Dip Hunter products, it would always be USDC.
Payment Currency is the currency that you could use to purchase this product. For Dip Hunter products, it could be either USDC or USDT. USDT will be converted into USDC automatically based on the price at the time of purchase.
Settlement Currency is the currency that you’ll receive at the expiry of the product. For Dip Hunter products, it would always be BTC
Expiry Date is the date when your investment products are settled. Your return from this product will also be automatically credited into your account on this day.
Discount, in percentage term, is the proportion that will be taken off from the price at which you can buy BTC at the expiry of the product.
Linked Price is a benchmark price. At expiry, the Settlement Price will be compared with this benchmark price to determine at which price you will buy BTC.
Settlement Price is the average of the Settlement Index in the last 30 minutes before 16:00 (UTC+8) on the Expiry Date
Settlement Index is derived from 7 leading BTC-USD exchanges, including Bitstamp, Bittrex, Coinbase Pro, Gemini, Itbit, Kraken and LMAX Digital.
Purchase Price is the actual cost for you to purchase BTC upon expiry. It is used to calculate the quantity of BTC you get on Expiry Date: If Settlement Price ≤ Linked Price, Purchase Price= Linked Price *(1-Discount). If Settlement Price＞ Linked Price, Purchase Price= Settlement Price *(1-Discount)
Let's take a look at at how a Dip Hunter Product works:
Here we have a USDC-BTC product with the parameters as follows:
- Linked Price: 6,000
- Expiry Date: 27-Dec-2019
- Yield: 5%
- Investment Currency: USDC
On 11-Dec-2019, Alice bought 10,000 USDC notional of the above product.
On 27-Dec-2019
- If the BTC/USD Settlement Price is above 6,000 USD, Alice will be able to buy BTC at a 5% discount off the Settlement Price. For example, if the Settlement Price is 6,500 USD (>6,000 USD), the actual price for Alice to buy BTC would be 5% off 6,500, i.e. 6,500*(1-5%)=6,175 USD. Since she has invested 10,000 USD in the beginning, she’ll receive 10,000/6,175≈1.6194 BTC.
- If the BTC/USD Settlement Price is at or below 6,000 USD, Alice will be able to buy BTC at 5% off the Linked Price. That is to say, if the Settlement Price is 5,800 USD (<6,000 USD), the price for Alice to buy BTC will be 6,000*(1-5%)=5,700, and she will thus receive 10,000/5,700≈1.7544 BTC.
There is no prerequisite on your Identity Verification level to buy this product. Once you have assets no less than the minimum purchase quantity in your account, you are free to invest. However, we do suggest you to carefully review the product specifications. You will also be asked to take a quick quiz before making the first investment to ensure that you have fully understood the investment rules.
The minimum investment amount is 100 USDC/USDT. There is no maximum limit for investors as long as there is quota left for the product.
It is irrevocable after the purchase is successful. You will hold the product till the Expiry Date.
No early redemption is allowed. It will be settled on the Expiry Date by 16:30 UTC+8.
You will get your BTC settlement by 16:30 UTC+8 on the Expiry Date. It will be credited into your wallet automatically and there is no need for manual redemption.