Market Specifications

Introduction

The Market Details panel on Demex offers important market parameters for each market. This article describes each field in more detail.

All Markets

The following market parameters apply to all markets.

Fee Tier

Your Fee Tier is determined by your staked SWTH amount. To climb up the tiers, you can increase stake more SWTH, or simply accumulate more SWTH or rSWTH.

As you progress to higher tiers, your maker and taker fees decreases.

Learn more here.

Maker Fees

Maker fees are incurred when a trader places an order that does not fill immediately (same block as order placement or trigger). This means the order appears on the order book, thereby adding liquidity to the market.

You can reduce your maker fees (and potentially earn maker rebates) by increasing your Fee Tier.

Taker Fees

Taker fees are incurred when a trader places an order which then fills in the same block in which it is placed or triggered. This means the order does not show up on the order book, and is taking liquidity from the market.

You can reduce your taker fees by increasing your Fee Tier.

Lot Size

The minimum quantity adjustment for a market. For example, a lot size of 0.1 means that 10.1 can be entered as an order quantity, but not 10.15.

Tick Size

The minimum price increment at for an asset or contract. In other words, this is the smallest possible price change for a market. For example, a tick size of $1 means that $9 is a valid order price, but not $9.1.

Minimum Order Amount

The minimum amount that must be traded for a single order.

Futures & Perpetuals

The following market parameters only applies for futures and perpetual markets.

Price Oracle

The oracle ID for the oracle that fetches the Index Price for the market.

Settlement Token

All perpetual contracts on Demex are settled in $USDⒼ (Carbon grouped USD token).

Learn more about $USDⒼ here.

Trading Bandwidth

The maximum allowable percentage difference between the Mark Price and the price at which trades can be executed.

When an order matches at a price outside this specified bandwidth, it will be automatically cancelled (instead of being executed). This mechanism helps maintain price stability and prevents extreme price fluctuations in the market.

Initial Margin Base

The minimum initial collateral ratio needed to initiate a position in this market. For larger positions, the requirement may be raised incrementally based on the Initial Margin Step.

Initial Margin Step

The increment in the initial margin requirement for larger positions. Each time a position is increased by Risk Step Size, the initial margin requirement is increased by this ratio.

Risk Step Size

Each time a position increases by this size, the Initial Margin requirement will increase by Initial Margin Step.

Initial Margin

Initial margin refers to the minimum amount of collateral required to open a position.

IMF = InitialMarginBase + (floor[PosSize / RiskStepSize] * InitialMarginStep)

InitialMargin = IMF * PosSize * EntryPrice

Maintenance Margin Ratio

The minimum value of collateral needed to maintain an open position is given by the Initial Margin multiplied by this ratio. If your collateral value for the position drops below this Maintenance Margin requirement, your position will be liquidated.

Maintenance Margin

Maintenance margin refers to the minimum amount of collateral required to maintain an open position.

MaintenanceMargin = MaintenanceMarginRatio * InitialMargin

Funding Rate

Funding rate refers to the periodic fee paid between traders based on the market price and prevailing spot price.

Therefore, when the market price of perpetuals is higher than the spot price, the funding rate is positive. Conversely, when the spot price exceeds the market price of perpetuals, the funding rate becomes negative.

Funding Rate = 1 hr TWAP of ((Mark Price - Index Price) / Index Price) / 24

Funding occurs every hour, and it is important to note that there are no additional fees charged for funding. All funding payments are exchanged exclusively between holders of perpetual contracts. This creates a zero-sum funding scenario, where long positions receive funding from short positions, or short positions receive funding from long positions.

Impact Size

The quantity of orders on the order book that will be used to determine the Mark Price.

Learn more here.

Mark Pricing Strategy

The Mark Price is the price at which the perpetual futures contract is valued during trading.

• Last Price: If the oracle network is down or the index price cannot be updated, the mark price formulation uses the last traded price of the market.

• Fair Price: The mark price is determined by finding a fair price based on the current market's order book, ensuring it doesn't deviate excessively from the index price.

Mark Price Band

This band sets the upper and lower price thresholds for the Mark Price for the market. The Mark Price will never differ from the Index Price by more than this ratio (in basis points).

Last Price Protected Band

This band sets the upper and lower price thresholds for the Mark Price when the market is in Last Price Marking mode. In this mode, the Mark Price will never differ from the Last Price by more than this ratio (in basis points)