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These past few days, the people getting liquidated while farming points on Papertrade have had it really rough. Some groups are even posting: “Taking in Papertrade-liquidated college girls.”

So, is there a way to farm points with controlled risk?

Yes. Today, we’ll teach you how to use Papertrade + HertzFlow for Delta hedging, accumulating PAPER while controlling directional risk.

Papertrade + HertzFlow hedged PAPER accumulation, actionable plan: Papertrade has no traditional points; PAPER comes from realized losses.
The goal is not to mindlessly create losses, but to have HertzFlow’s opposite position cover as much of that loss as possible.

Using BTC as an example:
① Prepare funds
Place 500 USDC on each side, using only about 20%–30% as margin. Keep the remainder to absorb price deviations and add to positions. Keep leverage on both sides at 2–3x; stay away from 1000x.
② Match notional positions
Assuming BTC = $100,000: Papertrade: go long $10,000 worth of BTC
HertzFlow: go short $10,000 worth of BTC
Key formula: Paper notional value ≈ HertzFlow notional value
Match the position value, not the margin.
③ Order of opening positions
HertzFlow is executed by a Keeper and may be slower than Papertrade. Submit the HertzFlow short order first. After confirming the execution price and position status, immediately open an equal-sized long position on Papertrade. Keep the interval between the two executions as short as possible. If the price difference exceeds 0.15%, cancel this round and do not chase.
④ Set trigger conditions
Prepare to exit both positions simultaneously when Papertrade’s floating loss reaches 0.3%–0.5% of the notional position. For example, if BTC falls 1%:
Papertrade: approximately $100 loss
HertzFlow: approximately $100Papertrade profitAfter closing the positions, this $100 realized loss will generate PAPER based on the real-time minting rate. If the rate is 25 PAPER/$ at the time, the theoretical output would be approximately 2,500 PAPER.

⑤ Closing plan
First close the slower-executing HertzFlow position. After confirming that the trade has been executed, immediately close the Papertrade position. Continuously monitor net exposure throughout the process:
Net exposure = Paper notional position − HertzFlow notional positionIf net exposure exceeds 2% of the total position, immediately reduce and recalibrate the positions instead of continuing to wait for the target price.

⑥ If the direction reverses
When BTC rises, Papertrade makes a profit while HertzFlow takes a loss, so no PAPER is generated. The solution is not to increase leverage, but to stop out both positions when the portfolio loss reaches 0.5% of principal, end the round, and wait for the next fluctuation before reopening positions.

⑦ Calculate the true cost
At the end of each round, record: Total cost = net PnL on both sides + fees + Funding + Gas + slippage + price-source deviationCost per PAPER = total cost ÷ actual PAPER received

This strategy is worth continuing only if the cost per PAPER is lower than the valuation you can tolerate. Papertrade uses the midpoint of Hyperliquid BBO, while HertzFlow uses an oracle and Keeper execution, so prices on the two sides will not be perfectly synchronized. Testing with small positions, using low leverage, and setting a maximum loss are more important than pursuing trading volume.

This is not risk-free arbitrage, but rather a conversion of directional risk into calculable basis and execution costs. This article is for technical discussion only and does not constitute investment advice. DYOR