A Perpetual Swap Contract is similar to a futures contract, but with the following distinctions:
- No expiry, settlement, or delivery
- Funding payments between longs and shorts keep the perpetual contract price tethered to the underlying spot asset price (unlike futures which may have a wide basis)
All users trading on margin should be familiar with the following:
- Initial Margin and Maintenance Margin determine the maximum leverage with which a user can trade, and the price at which automatic liquidation is triggered. Maximum leverage for perpetual contracts is 100x.
- Forced liquidation is triggered when a user cannot fulfill their maintenance margin requirement. All maintenance margin is lost when liquidation occurs.
- The Mark Price is used to determine unrealized P&L and liquidation price.
- The Qume Bitcoin Index (QBI) tracks the spot price of Bitcoin.
- Contracts are settled in USD.