What is PAPER, and what does it cost?

How PAPER is minted

Papertrade is a perpetuals exchange on HyperEVM where every trade is made against a single pool. PAPER is its token, and there is one way to get it: lose. When a trade is closed at a loss or liquidated, the exchange mints PAPER to that wallet in proportion to the loss.

Nothing else creates PAPER. According to the Papertrade docs, supply started at zero, with no pre-mint, no team or investor allocation and no airdrop.

The rate is not fixed. While the pool's running total stays below $2.00M, a dollar of loss mints 100 PAPER. Above that, the rate decays as the pool grows. The earlier the loss, the more PAPER it bought.

No market price, only a cost

PAPER cannot currently be transferred between wallets, so it cannot be sold, bought or listed anywhere. There is no market price to quote, and any “price of PAPER” is somebody's estimate.

What every wallet does have is a cost: what it lost to get its PAPER. PAPER Scope counts it as the wallet's net loss, realized plus unrealized, divided by the PAPER it received. It is what was paid, not what the token is worth.

A wallet that simply loses pays the full price: one dollar divided by the mint rate. A wallet whose winning trades cover part of its losses pays less. A wallet that is up overall got its PAPER for nothing.

Why the same token costs wallets so differently

• When the loss happened. The mint rate has been falling since launch, so the same dollar lost later buys less PAPER.
• Whether wins offset the losses. Cost is counted on the net result. A trader who wins about as much as they lose collects PAPER on every losing trade and pays only the difference.
• How the wins were taken. Papertrade takes its cut from winning closes, and the cut is larger on small price moves. A hedge closed after a tiny move gives most of the win back. What a hedged farm costs has the numbers.

A plain loss has never minted PAPER for less than $0.0100. A wallet with a lower cost had winning trades pay the difference. The cheapest wallet with 1M+ PAPER that paid anything at all sits at $0.0001.

What PAPER gives its holder

Staked PAPER earns USDC: half of every trading fee, plus everything the pool gains above its cap of $5.00M. Staking and unstaking are instant and there is no lockup. PAPER that is held but not staked earns nothing.

A PAPER staked since launch has earned $0.0095 so far. For a token that cost the median $0.0104 and was staked from the start, that is 91% of the cost paid back. Tokens staked later have earned less.

More in how PAPER staking pays.

Short answers

Is there a Papertrade airdrop?

No. The Papertrade docs say there is no airdrop, no pre-mint and no team or investor allocation. The only way to receive PAPER is to close a losing trade or be liquidated.

Can I buy or sell PAPER?

Not at the moment. PAPER cannot be transferred between wallets, only staked and unstaked. There is also no way to deposit into the pool directly.

Does a lower cost mean a better token?

The token is the same: every staked PAPER has the same claim on payouts. A lower cost means the same payouts for less money. Whether any cost is paid back depends on what staking pays from here, and nobody knows that.

Is PAPER Scope run by Papertrade?

No. It is an unofficial community tool that reads the public Papertrade data. Nothing here is financial advice.