Reasonable Mark Price Description
In order to improve the stability of the contract market and reduce unnecessary forced liquidation when the market fluctuates abnormally, the BKEX trading platform uses the mark price to calculate the user's unrealized profit and loss. The mark price refers to the spot price index of the head exchange plus the decreasing capital cost basis, that is, the mark price reflects the real-time spot price of the main exchange.
BKEX uses the mark price to calculate the reasonable equity of the account as the standard for collecting margin and calculating liquidation and bankruptcy prices. Set the mark price to a reasonable price instead of the latest traded price to avoid unnecessary liquidations. The mark price only affects the liquidation price and unrealized profit and loss, not realized profit and loss.
For perpetual contracts, the reasonable mark price is equal to the underlying index price plus the funding fee basis that decreases over time.
Calculate the fair mark price for perpetual contracts
The reasonable mark price of the perpetual contract is calculated using the funding fee basis rate:
Funding Basis Rate = Funding Rate * (Time to Next Funding Payment / Funding Interval)
Fair Mark Price = Index Price * (1 + Funding Fee Basis Rate)
Latest market price description
The latest market price refers to the current market price of the BKEX platform. The latest market price is always anchored to the spot price due to the funding mechanism, which is why the latest market price of BKEX does not deviate too far from the spot market price.
All in all, BKEX reduces the price difference through a complete price mechanism to ensure a fairer trading environment, thereby protecting traders from malicious liquidation losses.
The market price of digital currency fluctuates violently, and the latest market price of the BKEX platform may temporarily deviate from the marked price, which may lead to obvious unrealized gains or losses immediately after placing an order. Note that this does not mean actual gains or losses. Traders should always pay attention to the changes between the reasonable mark price and the latest transaction price to avoid unnecessary liquidation losses.