Liquidation Capture Engine (In Beta)

Overview:

The Liquidation Capture Engine is a proprietary system designed to recover value from failed trades on challenge and funded accounts by reversing them at key inflection points. Instead of writing off max loss trades entirely, this system converts high-risk drawdowns into potential profit opportunities for the pool.


🧠 How It Works:

When a funded trader approaches critical drawdown levels, the system mirrors their open position in the opposite direction via a strategic vault. If the trader’s original position is closed at a loss, the reversed trade captures the continuation — turning a high-probability loss into a win for the ecosystem.

This approach is aimed at converting historically unprofitable behaviour into a revenue-generating mechanism.


💰 Powered by Prime Bridge

Our market-making partner, Prime Bridge, operates the liquidation vault that powers this strategy. Here’s how the economics work:

  • Profit Split:

    • 50% of profits from these reversal trades are retained by Prime Bridge.

    • The remaining 50% is automatically routed back into the trader pool to support sustainable funding and payouts.

  • Vault Transparency:

    • Performance of this strategy vault is published weekly in the #stats channel on our Discord server.

    • Real-time metrics and historical returns are available via our trader portal dashboard.


🌐 Coming Soon: Community Staking

In future updates, we will open access for external participants to stake into the LCE vault. These stakers will receive a share of the vault’s profit, distributed proportionally based on their contribution.

This will unlock new ways for community members to earn yield by participating in the risk ecosystem directly.


⚙️ Benefits:

  • Recovers part of the drawdown as internal profit.

  • Creates a “negative alpha capture” stream for the vault.

  • Supports sustainable withdrawal management without affecting user trust.


🎯 Why This Matters

  • Enhanced Risk Control: Converts failing trades into data-driven hedges.

  • New Yield Stream: Adds a sustainable, trade-derived revenue source outside of challenge fees.

  • Transparent Execution: Tracked and reported in real time, aligning with our open-risk model.

⚠️ Note: The underlying parameters of this system are confidential and continuously optimized to avoid system abuse and protect intellectual property.

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