Perpetual futures terms & definitions

Perpetual futures are futures contracts with no expiry date that seek to replicate the performance of an underlying spot asset. 

Terms and definitions

Collateral value 

Market value of collateral in USDC before applying a collateral multiplier to the asset

Cross margin

Allows margin balances to be shared across different positions.

Isolated margin

Allows margin balances to be assigned to a single position which cannot be shared across different positions.

Funding fee

The funding fee is based on the difference of the perpetual futures and spot price, and the size of the long or short position. Funding fees are only applicable for users who have an open position at the end of a given interval.

If you close your position prior to the funding interval end, you are not subject to the funding fee or credit. When a funding interval ends, all open perpetual futures positions will pay or receive funding fees.

  • Calculation: The funding fee is determined by calculating the funding rate in proportion to your size of position value.

  • Formula: Funding Fee = Position Value * Funding Rate.

Initial margin requirements

The amount of funds required to open a futures position. Initial margin requirements vary by product and are typically a small percentage of the contract’s value.

Locked collateral

Collateral that has been occupied to open a position and held for open orders 


Indicates the ability to open an order with an investment of only a portion of the notional value. By putting down a small amount you magnify the effect of any price change. It is calculated as the notional value / required margin.

Mark price

A moving average of the index and smoother and more robust representation of the market price of a contract

Mark to market

Mark to market evaluates the value of portfolios over time and happens at a frequency of every 1 second on the International Exchange.  Each asset and market will go through this process, and all portfolios with active positions will go through a process of recalculating the position exposure and unrealized profit and loss.

  • Calculation: The mark to market calculation is based on the central limit order book mark price and is used to calculate unrealized profit and losses, flag portfolios violating margin requirements, and trigger any liquidation procedures for flagged portfolios.


Settlements ensure that unrealized profits or losses do not accumulate, reducing risk for customers and the platform. When a settlement occurs, your balances are adjusted based on your gains or losses from the settlement price. Settlements are paid in USDC.

Trades will be settled every 5 minutes by determining a settlement price and applying it to all open positions.

Unrealized PnL

Unrealized profit or loss on open futures positions. Unrealized PnL can be used as Available Collateral

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