What is a Futures Contract?
A Futures Contract is an agreement to buy or sell a commodity, currency or other instruments at a predetermined price at a certain time in the future.
What is Perpetual Contract?
A Perpetual Contract is similar to a traditional futures contract in terms of trading, yet it will not expire so that you can hold a position for as long as you wish. The Perpetual Contract at BaseFEX tracks the underlying Index Price.
It achieves this via a Funding mechanism.
What is the Mark Price?
How does BaseFEX determine the price of a Perpetual Contract?
BaseFEX uses the Fair Price Marking method to mark the price of contracts. The price determines your Unrealized PNL, and the Realized PNL will be determined by the entry price and exit price or the Settlement Price and any other fees caused.
How does BaseFEX calculate the Settlement Price?
Settlement Price is the price where a futures contract settles. In order to avoid price manipulation, BaseFEX takes an averaging over a period of time before the settlement, yet this time frame might fluctuate due to different instruments.
How to buy or sell a Perpetual Contract?
Go to the Trade dashboard, then choose the quantity, price and direction you want to trade and use
Sell/Short buttons to place your order.
Bid and Ask?
Bid is a standing order where you want to buy/long a contract at a certain price and quantity. Ask is a standing order where you want to sell/short a contract at a certain price and quantity.
How much leverage does BaseFEX offer?
BaseFEX offers different amounts of leverage for different products.
Leverage is determined by the Initial Margin and Maintenance Margin levels. These levels specify the minimum equity you must hold in your account to enter and maintain your positions. Leverage is not a fixed multiplier but rather a minimum equity requirement. You can see the minimum Initial Margin and Maintenance Margin levels for all products at Risk Limits.
BaseFEX offers leverage on each of its products, and the highest leverage offered at BaseFEX is up to 100x, such as the BTC/USD Perpetual Contract.
What is Initial Margin?
Initial Margin is the minimum amount of Bitcoin you must deposit to open a position.
What is Maintenance Margin?
Maintenance Margin is the minimum amount of Bitcoin you must hold to keep your position open. Once your margin balance on BaseFEX falls below this level, your position will be liquidated automatically.
What does it mean when notified that open position price is better than liquidation price?
When buy/long, opening position order price is lower than the liquidation price of your long position. When sell/short, opening position order price is higher than the liquidation price of your short position.
What does it mean when notified that close position price is worse than bankruptcy price?
When buy/long, closing position order price is higher than the bankruptcy price of your short position. When sell/short, opening position order price is lower than the bankruptcy price of your long position.
Why is it forbidden that opening position order price is better than the liquidation price of existing position?
If so, the existing position will be liquidated before execution of the order, by then the order will still be cancelled in the process of liquidation.
Why is it forbidden that closing position order price is worse than the bankruptcy price of existing position?
When the market sees extreme volatility, execution of the closing position order may lead to balance going below 0.
Why would I be liquidated?
If the Mark Price of your contract falls below your liquidation price for Long position, or it rises above your liquidation price for Short position, your Maintenance Margin level will be broken and the system will take over the position instead. You can check your liquidation price in Trade History, where your liquidated position is closed at the Bankruptcy Price (which means your Maintenance Margin is equal to 0).
How does a Liquidation happen?
Once your position is going to be liquidated, the system will try to close the position at the prevailing market price. However, if the system fails to liquidate that position, then our Liquidation Insurance Fund comes to handle.
What is Insurance Fund?
The Insurance Fund is created to take on the unfilled liquidation orders before they are handled by the Auto-Deleveraging system.
Our Insurance Fund comes from liquidations that were able to be executed in the market at a price better than the bankruptcy price of that particular position.
What is Auto-Deleveraging?
Auto-Deleveraging happens when a liquidation remains unsettled in the market. Those who hold opposite positions will be closed according to leverage and priority based on the profits.
Does BaseFEX charge fees on Auto-Deleveraging?
No. BaseFEX does not charge any fees during the process of Auto-Deleveraging.
Will I get bankrupted?
No. BaseFEX has established a profound mechanism to protect the funds of our users, your margin balance on the platform will never fall below 0.
Will BaseFEX socialize losses?
No. Since we have our Auto-Deleveraging mechanism, we do not need to further socialize the losses.
Does BaseFEX charge fees on depositing Bitcoin?
No. No fees will be charged on deposits at BaseFEX.
Does BaseFEX charge fees on withdrawing Bitcoin?
No. No fees will be charged on withdrawals at BaseFEX. If you want to withdraw your Bitcoin, the minimum Bitcoin Network fee will be charged according to the blockchain load.
Why would I receive Bitcoin Network fee refunds?
The Bitcoin Network fees set by the users for withdrawals are actually maximum.
For the benefit of our users, we handle the withdrawals in batches and we will apply the optimizations without the sacrifice of transaction speed. We will return the saved fees back to our users.
Does BaseFEX charge fees on trading?
Yes. BaseFEX charges a trading fee on every completed trade. You can check the Fees for detailed information.
Deposits and Security
How can I deposit?
What is the minimum deposit amount on BaseFEX?
The minimum deposit amount on BaseFEX depends on the Initial Margin. Take our BTC/USD Perpetual Contract for example, you should pay
$1 * 1% = $0.01. The supposed price of BTC/USD is $7000, this equals to 0.00000143 BTC.
What kind of wallet does BaseFEX use?
BaseFEX stores all Bitcoins in a cold multi-signatured wallet.
What is a cold multi-signatured wallet?
A Cold multi-signatured wallet stores your Bitcoin offline and requires multiple signatures to make any expense. At BaseFEX, we require 5 out of 7 partners to sign for any transaction before the expense.
Why does BaseFEX use multi-signatured address?
We use this kind of address in order to prevent any kinds of theft to ensure the safety of our users' funds.
When does BaseFEX handle the withdrawals?
The cutoff time for Bitcoin withdrawals is at 7:00 UTC+00 everyday. Your Bitcoin will be sent to your address shortly after this time.
How can I get help if I have a problem?
You can send an e-mail to reach out for help. See Support.