How does the pricing mechanism work for perpetual futures contracts in the context of digital currencies?
Haransh SinghJun 16, 2022 · 3 years ago1 answers
Can you explain in detail how the pricing mechanism works for perpetual futures contracts in the context of digital currencies? I'm particularly interested in understanding how the pricing is determined and what factors influence it.
1 answers
- Lord_KrutorekMay 01, 2025 · 4 months agoAt BYDFi, the pricing mechanism for perpetual futures contracts in the context of digital currencies is based on a combination of factors. The spot price of the digital currency, the interest rate, the funding interval, and the difference between the contract price and the spot price all play a role in determining the pricing. These factors are used to calculate the funding rate, which is a periodic payment made between long and short positions. Market demand, trading volume, and market sentiment can also influence the pricing. It's important for traders to understand these factors and how they can impact the pricing of perpetual futures contracts on different platforms.
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