A Perpetual Contract is a derivative product that is similar to a traditional futures contract, there is no expiry or settlement, there is no time limit for position holding. Meanwhile, in order to track underlying index price, the perpetual contract uses funding cost mechanism to ensure that the price follows closely to underlying price. Each calculation of a funding always includes the current perpetual contract’s discount/premium assessment of the situation for both long and short, is determined by the actual trading result of long and short, BBX does not charge any fee.
When trading perpetual contracts, a trader needs to be aware of several mechanics of the market. The key components a trader needs to be aware of are:
- Position Marking: Perpetual Contracts are marked according to the fair price marking The Mark Price determines unrealized PNLand liquidation prices.
- Initial and maintenance margin:These key margin levels determine how much leverage one can trade with and at what point liquidation occurs.
- Funding: Periodic payments exchanged between the buyer and seller every 8 hours. If the rate is positive, then longs will pay and shorts will receive the rate, and vice versa if the rate is negative. Note: You will only pay or receive funding if you hold a position at the Funding Timestamp.
- Funding Timestamps: 04:00 UTC, 12:00 UTC and 20:00 UTC.
Traders can observe the current funding rate for a contract on the Trade tab under “Funding Rate”.
Historical rates are in the Funding Rate History..
What are the advantages of BBX perpetual contract?
- Compares to traditional futures, there is no expiry or settlement, and no need to pay attention on trading strategy adjustment brought by settlement or violent fluctuation during renewal period.
- Adds liquidation mechanism which relies on marking price. The index uses the data sources from more than three big exchanges and median variance mean passivation mechanism (MVPM), guarantees the trading result will not be manipulated and be more smooth, it not only eliminates the liquidation caused by the market price control in the traditional contract, but also avoids the liquidation caused by the instantaneous extreme market.
- Reasonable maker compensation fees. In the BBX perpetual contract, makers in the market will be encouraged, not only will not pay transaction costs, but also provide additional or high maker bonus (0.025% of contract value).
- Timely and reasonable exit mechanism. In the BBX perpetual contract, you don't have to worry about the “exploitation” of your realized profits and losses due to other traders' liquidation. You can also take out your realized profits and losses at any time, and there is no room for black-box operation.
- Supports cash contract, uses the stable currency such as USDT to calculate the profits, and avoid the impact of the fluctuation of the guaranteed currency when it is at the non-position status.