Mark Price for USDT-Margined Futures

To reduce unnecessary forced liquidation in an abnormal volatile market and improve the stability of contracts market, we use the mark price instead of the latest fill price to calculate users' unrealized profits and losses (unrealized PNL), as well as the liquidation price.


Mark Price Calculation Formula

In perpetual contracts, mark price = index price + basis moving average

Basis moving average = moving average (contract median price - index price) = moving average [(contract sell 1 price + contract buy 1 price) / 2 - index price]


Benefits of Mark Price

The mark price takes into account both the spot index price and the moving average of the basis. The moving average mechanism reduces the fluctuations in the short-term contract price and reduces unnecessary forced liquidation caused by abnormal volatility.

The buy 1 price and sell 1 price are shown in the diagram as 1 and 2, respectively, with 3 representing the index price.


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KuCoin Futures Team


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