Papertrade maintains non-transferable PAPER token to prevent price manipulation via external shorting, and adjusts minting mechanics to improve fairness for new users.
Regulation & Gov ·
Papertrade has decided to keep its PAPER token non-transferable to protect against a specific attack vector involving perpetual derivatives markets. The protocol's leadership noted that if PAPER could be shorted on external perp exchanges, attackers could amplify the payoff of price manipulation schemes by combining a direct price attack with short exposure on the token itself. According to the team, allowing transferability at this stage would create conditions too risky to permit material trading activity on the platform.
The PAPER token was designed as both an insolvency safeguard and a rebate mechanism for losing traders, integrating deeply into Papertrade's economics. The non-transferability constraint exists because the protocol's bankroll size is deliberately limited to control the economics of potential attacks; a short market for PAPER would effectively raise the attack threshold by adding to the target exposure, making manipulation campaigns cheaper and more viable for bad actors.
Separately, Papertrade is adjusting its minting mechanics to provide fairer access for newer users, shifting the token closer to its original purpose as exchange rakeback. The precise details and timeline of these changes remain unclear from the available information.