Term
Definition
The average price of an underlying asset
The digital asset that a Futures/Perpetual Contract price is based on
The latest price at which the asset was traded
Mark Price / Mark-to-Market / MTM

Mark Price is a relatively fair price weighted by multiple prices; its main purposes are:

  • To calculate unrealized PnL
  • To determine if liquidation will occur
  • To avoid the market manipulation and unnecessary liquidation

For Mark Price calculation, please visit: This FAQ

The current price of a specific asset that can be traded immediately
The reference value of the underlying assets corresponds to the position you currently hold
* Notional Value = current Mark Price x Position Size x Contract Size
E.g. If you buy 100 BTC contracts at $4000 (but the current mark price is $4020), then the current notional value is 4020 x 100 x 0.001 = $402
The amount of underlying assets that each contract contains.
Each contract contains 1/1000 underlying asset, so the contract size is 0.001
The amount of contracts that you trade when a position is taken.
A position is the amount of contracts owned by you. There are two types of positions:
  • Long Position / Buy Position, i.e. purchased first and sold later.
  • Short Position / Sell Position, i.e. borrowed to sell first, then bought back.
Long Position / Buy Position
Purchased first and sold later
For example: If you have purchased 100 contracts of BTC, then you are holding a long position; you must sell these contracts to close this position.
Short Position / Sell Position
Borrowed to sell first, then bought back.
For example: If you borrowed 100 contracts of BTC to sell, then you are holding a short position; you must buy back the same amount of contracts to close this position.
The initial buy/sell price of the position.
The ratio of the initial margin to the order value. The greater the leverage, the less initial margin you need to pay, which means you can obtain a larger position with the same amount of initial margin.
  • Initial Margin = Order Value / Leverage
  • For example:
    The initial margin with 100x leverage = order value / 100 = 1% of the order value
    The initial margin with 1x leverage = order value / 1 = 100% of the order value
The minimum initial margin percentage and minimum maintenance margin percentage for different position sizes.
  • To avoid many traders being auto-deleveraged, BTSE imposes risk limits on all trading accounts to minimize the occurrence of large liquidations.  Whenever your position exceeds a certain size, your margin requirement will increase to facilitate the closing out of the position with the market price if your position is liquidated.
  • For more details of Risk Limit, please visit: How to read your margin tab and leverage tab
You must provide a certain amount of capital in order to open/hold a contract.  The percentage you must pay depends on what leverage you have chosen. E.g. With 100x leverage, you have to put in 1% of the order value as your margin.
The minimum available margin balance required when you open a position.
A margin balance that required to maintain the position (your margin balance must be greater than this amount).
Once the balance is equal to or less than the maintenance margin, your position will be liquidated.
  • The balance in your cross wallet can be assigned as initial margin for contracts from multiple digital currencies simultaneously (e.g. it can be assigned as the margin for BTC, ETH and LTC contracts all at the same time).
  • Contracts which are assigned to this wallet will draw from your cross wallet balance to satisfy their own maintenance margin requirements.
  • BTSE will assign a US dollar value to your cross wallet when using any assets from your multi-currency spot wallet as collateral for futures trading.
    * Digital currencies are converted into a USD dollar value, BTSE will hold 10% of the digital asset value as collateral.
  • The balance in your isolated wallet can only be assigned as the initial margin by one type of contract at a time.
  • Contracts which are assigned to this wallet would draw from its balance to satisfy their own maintenance margin requirements.
  • BTSE will assign a US dollar value to your isolated wallet when using any assets from your multi-currency spot wallet as collateral for futures trading.
    * Digital currencies are converted into a USD dollar value, BTSE will hold 10% of the digital asset value as collateral.
Liquidation / Forced Liquidation / On-Market
When the mark price reached the liquidation price, that means the available balance of your margin wallet has been depleted, therefore you don't have enough money to maintain the position.
The system will:
1. Take over both your position and the rest of the margin belonging to this position.
2. Try to close the position at the price level between the liquidation price and the bankruptcy price.
3. If the position can't be closed at the bankruptcy price, the system will try to draw extra margin from the BTSE insurance fund to further adjust the price of the .
4. If the position still can't be closed after further adjustment, auto-deleveraging will occur to close the position.
The price where the mark price level will trigger liquidation.
When liquidation occurs, the system would automatically send a notification email to notify that your position has been liquidated. 
The price where the margin balance is zero.
Auto-Deleveraging / ADL / Off-Market
When a trader’s position is liquidated, the position will be taken over by the liquidation engine. If the position cannot be closed at the bankruptcy price, the engine will try to draw extra margin from the BTSE insurance fund to further adjust the price of the liquidation order. If the position still can't be closed after further adjustment, Auto Deleveraging (ADL) will occur to close the position.

When an ADL occurs, the system will reduce or close the opposing trader's position until the liquidation order is filled. The deleveraging sequence is determined by the ADL ranking. More profitable and higher leveraged traders will be auto deleveraged first.

You can check the ADL indicator to find out your ADL ranking level. The higher bars you see means the higher chances of being auto deleveraged. To avoid this, you can add more margin to reduce the leverage ratio and lower your ADL ranking.

Profit and Loss
Unsettled profit and loss from the open position.
Displayed unrealized PnL:
Longs = (Current Mark Price - Position Entry Price) x Contract Size (0.001) x Position Size
Shorts = (Position Entry Price - Current Mark Price) x Contract Size (0.001)  x Position Size
Settled profit and loss from the open position.
Realized PnL:
Longs = (Market Price - Position Entry Price) x Contract Size (0.001) x Position Size - Transaction Fee
Shorts = (Position Entry Price - Market Price) x Contract Size (0.001) x Position Size - Transaction Fee
A market maker is a brokerage house that provides purchase and sale solutions for investors in order to provide liquidity to the markets.
Periodic payments exchanged between the Longs and Shorts every hour.
  • If the average perpetual contracts price is higher than the spot price, Longs will pay the Shorts, and vice versa if the average perpetual contracts price is lower than the spot price.
  • You will only pay/receive funding fees if you hold a position at the moment of the funding timestamp 
Click Here to see the example.
Basis / Basis Differential
When a futures contract reaches the expiry date, the contract price should be quite close to the spot price, if not, the difference between the spot price and the futures price called Basis or Basis Differential.
* Basis = Spot Price - Entry Price of the contract
Bid / Bid Price
An offer made by a buyer to buy a contract.
Ask / Ask Price
An offer made by a seller to sell a contract.