Coinlocally Docs
Perpetual Contracts
Perpetual Contracts
  • Introduction
  • Overview
    • Funding Rate
    • Mark Price
    • Index Price
    • Ladder Balancing Mechanism
    • Insurance Fund
    • Auto-Deleveraging (ADL)
  • USDT Margined Perpetual Contract
    • Introduction
    • Leverage and Position Limit
    • Ladder Maintenance Margin Rate
    • Margin and Profit/Loss Calculations
  • Coin Margined Perpetual Contracts
    • Currency Standard Perpetual Contract
    • Leverage and Position Limit
    • Ladder Maintenance Margin Rate
    • Margin and Profit/Loss Calculations
  • Functions
    • Perpetual Contract User Guide
    • One-way and Two-way Positions
    • Conditional Order
    • Take Profit, Stop Loss TP/SL
    • Take Profit Stop Loss Order
    • Contract Grid
    • Futures Copy
      • How to Carry Out a Transaction
      • Profit Sharing
      • How to Copy Trade
      • Futures Copy Trading Rules
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  • 1. Margin Requirements
  • 2. Valuation Unit
  • 3. Contract Face Value
  • 4. Profit and Loss Settlement Currency
  1. USDT Margined Perpetual Contract

Introduction

1. Margin Requirements

In USDT-margined perpetual contracts, all contracts across different trading pairs use USDT as the collateral asset. Users only need to hold USDT to participate in any USDT-standard perpetual contract (e.g., BTC/USDT, ETH/USDT, etc.).

By contrast, coin-margined perpetual contracts require users to hold the underlying cryptocurrency as collateral. For example, to trade the BTC/USD coin-margined perpetual contract, the user must deposit BTC as collateral.

Collateral Risk Comparison

Due to the difference in margin currencies, the risk of asset depreciation during market downturns varies:

  • In coin-margined contracts (e.g., BTC/USD), if BTC falls in price, users need to provide more BTC to maintain their position, exposing them to collateral depreciation.

  • In USDT-margined contracts, users post USDT as margin, which remains stable in value. Therefore, the collateral is not affected by the underlying asset's price movements.


2. Valuation Unit

  • USDT Perpetual Contracts are denominated in USDT.

  • Coin-Margined Perpetual Contracts are denominated in USD.

Example:

  • The BTC/USDT index price reflects the average BTC price quoted in USDT across various exchanges.

  • The BTC/USD index price reflects the average BTC price quoted in USD across exchanges.

3. Contract Face Value

  • In USDT-margined contracts, the face value is based on the underlying asset.

    Example:

BTC/USDT Contract Face Value=0.001 BTC\text{BTC/USDT Contract Face Value} = 0.001 \text{ BTC}BTC/USDT Contract Face Value=0.001 BTC
  • In coin-margined contracts, the face value is typically quoted in USD.

    Example:

BTC/USD Contract Face Value=$100\text{BTC/USD Contract Face Value} = \$100BTC/USD Contract Face Value=$100

4. Profit and Loss Settlement Currency

  • For USDT-margined contracts, PnL (profit and loss) is calculated and settled in USDT.

  • For coin-margined contracts, PnL is calculated and settled in the underlying asset.

Example:

  • In BTC/USDT, all profits and losses are realized in USDT.

  • In BTC/USD, profits and losses are realized in BTC.

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Last updated 1 month ago