Crypto Exchange OKEx to Launch USDT-Margined Perpetual Swap Trading

Popular cryptocurrency exchnages OKEx has announced the launch date of its highly anticipated USDT-margined perpetual swap instrument.

According to a press release, the exchange's latest crypto derivative offering will be officially ready for trading on December 16.

Much like the traditional futures trading offered on OKEx perpetual swaps essentially involve placing a bet on the future price of an underlying cryptocurrency. As in futures, traders can either open a short position, if anticipating a price drop or establish a long position, when expecting an increase.

However, in contrast to futures trading, perpetual swaps – as the name suggests – continue indefinitely. There is no expiry, allowing users to keep positions open continually. 

What’s on Offer?

OKEx' USDT-margined perpetual swap delivers several underlying cryptocurrencies to speculate on. These include BTC, EOS, ETC, ETH, LTC, BCH, BSV, TRX, and XRP.  Moreover, straight off the bat, OKEx will be offering a massive range of leverage, varying from 0.01–100x.

Explaining the reasoning behind it Jay Hao, CEO of OKEx elaborated on how successful futures trading had been so far:

OKEx has been at a stage where we kept evolving. We received great response from users after the launch of USDT futures trading last month. It has been a good example of us demonstrating our commitment in cultivating a good vibe in the derivatives space. Our goal is to provide a one-stop shop for professional and retail traders, offering both spot and derivatives product portfolio in one place. We’re always working to meet the needs of users in a shifting global economy and cryptocurrency ecosystem.

Details of OKEx's Perpetual Swap 

OKEx has designed several risk management techniques to insure against unjust liquidation and protect the underlying market. 

The first is the mark price. Typically a mark price system utilizes an index of prices to establish a consensus on 'fair price.' This has the effect of dampening the influence of market manipulation – combating against unusual or unfair liquidation. 

Further, OKEx's "Tiered Maintenance Margin Ratio (TMMR) System" deleverages traders and minimizes the impact of large liquidations on the market. To this end, OKEx also employs "Forced Partial Liquidation Mode" to lessen the consequence of market slippage caused by numerous liquidations. 

Before the big day, OKEx plans to run a simulation starting December 4, running until December 11.

Within the simulation, OKEx has devised a perpetual swap contest involving BTC/USDT, ETH/USDT, and EOS/USDT pairs. Traders are provided with a virtual 10,000 USDT to trade with each of the three pairs, with the total amounting to 30,000 USDT. Needless to say, the money isn't transferable or withdrawable and is only applicable for the duration of the trial simulation. 

Featured image via Pixabay.