At BingX, we are committed to providing a fair trading environment for all our users. To that end, we offer a dual-price mechanism for Perpetual Futures that protects users from malicious liquidations as a result of significant deviations between the price on the platform and the mainstream spot price. This helps prevent unnecessary losses and ensures a secure trading experience for our users.
1. What is Dual-Price Mechanism?
The conventional single-price mechanism can result in a mass liquidation of traders’ positions when the market experiences sharp fluctuations and the market price on a futures exchange deviates significantly from the spot price.
BingX dual-price mechanism consists of the mark price and the last price. Even if the mark price reaches the estimated liquidation price, a trader's position will not get liquidated as long as the last price does not reach the liquidation level. This mechanism effectively protects traders from potential forced liquidations that may occur due to abnormal price fluctuations caused by market manipulations.
2. How to Calculate the Prices?
2.1 Calculation of Last Price
The last price is the real-time filled price on the order book in BingX Perpetual Futures.
2.2 Calculation of Mark Price
Mark Price = Median (Price 1, Price 2, Last Price)
Price 1 = Index Price
Price 2 = Index Price + Moving Average (5-minute Basis)
*Moving Average (5-minute Basis) = Moving Average [(Best Bid + Best Ask) / 2 − Index Price], with values updated every second at a 5-minute interval.
Price 1 = Index Price
Price 2 = Index Price + Moving Average (5-minute Basis)
*Moving Average (5-minute Basis) = Moving Average [(Best Bid + Best Ask) / 2 − Index Price], with values updated every second at a 5-minute interval.
*Median: If Price 1 < Price 2 < Last Price, Price 2 will be taken as the Mark Price.
For more information on the mark price, please refer to Perpetual Futures | Mark Price & Index Price.
Special Note:
1. BingX will use the optimal mark price to reduce the risk of traders' positions being liquidated in volatile markets.
2. BingX reserves the right to update the mark price selection criteria in real time according to market conditions without prior notice.
2. BingX reserves the right to update the mark price selection criteria in real time according to market conditions without prior notice.
BingX Operation Team
2023-08-01
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