Pre-market Listings

Trading perpetuals involves significant risk, including the risk of liquidation and partial or total loss of assets. Review the Risk Disclosures and ensure you understand the risks before trading.

Pre-markets enable trading before a formed spot market exists. As a result, mark and index prices are derived from internal order book dynamics rather than external reference markets.

Due to the absence of reliable external pricing and typically lower liquidity, pre-markets carry increased risk, including higher volatility, wider spreads, and greater susceptibility to price dislocations.

Risk Framework

To account for these risks, pre-markets are launched with conservative risk parameters, including:

• Lower position limits

• More restrictive margin requirements

These parameters are designed to protect both users and the protocol during the early stages of price discovery.

Mark and Index Price

In pre-markets, both Mark and Index prices are derived from exponentially weighted averages of order book prices.

The market is initialised with initial_mark_price, derived from:

• OTC quotes

• Polymarket FDV

• Assumed token supply

Oracle Price

The oracle price represents a smoothed estimate of fair value based on historical mark prices.

• Sampled once per minute

• Defined as a 45-min EWMA of past mark prices

• When historical marks are unavailable, initial_mark_price is used as padding

oracle_0 = initial_mark_price

oracle_t = α · mark_{t−1} + (1 − α) · oracle_{t−1}

α = 1 − exp(−1 / 45)

To prevent runaway pricing in illiquid conditions:

oracle_t ≤ 5 × initial_mark_price

Mark Price

The mark price is the executable fair price used for PnL and liquidations.

• Computed once per minute, after the oracle update

• Uses impact mid price with $500 notional

• Combines the oracle (slow anchor) with a smoothed deviation

mark_t = oracle_t + D_t

D_0 = 0

D_t = β · (impact_mid_t − oracle_t) + (1 − β) · D_{t−1}

β = 1 − exp(−1 / 45)

Intuition:

• oracle_t captures long-term fair value

• impact_mid_t reflects current tradable levels

• D_t ensures gradual adjustment without overreacting to short-term noise

Index Price

The index price is a slower, manipulation-resistant reference price.

• Defined as a 45-min EWMA of mark prices

• Updated once per minute

• Uses the same decay as the oracle

• No caps are applied

index_0 = initial_mark_price

index_t = α · mark_t + (1 − α) · index_{t−1}

α = 1 − exp(−1 / 45)

Transition to Regular Market

Once the underlying spot market is live and reliable external pricing is available:

• Mark and Index prices transition to standard oracle-based pricing, referencing external market data

• Risk limits and margin schedules are revised to reflect improved liquidity and reduced uncertainty

No user action is required during the transition.