OKX to Revamp Funding Fee Mechanism for Perpetual Futures

OKX,
a
leading
cryptocurrency
exchange,
has
announced
significant
changes
to
its
funding
fee
mechanism
for
perpetual
futures.
The
update
aims
to
enhance
user
experience
and
improve
the
efficiency
of
funding
fee
settlements,
according
to
OKX.

Changes
to
Order
Cancellation
Logic

The
new
mechanism
will
adjust
the
order
cancellation
logic
during
settlement
across
four
phases.
While
the
calculation
logic
for
funding
rates
remains
unchanged,
the
collection
and
distribution
of
funding
fees
will
see
notable
improvements.

Collection
of
Funding
Fees

Previously,
OKX
collected
funding
fees
up
to
the
liquidation
threshold,
canceling
orders
if
necessary.
In
the
updated
model,
OKX
will
collect
the
full
amount
of
the
outstanding
funding
fee,
even
if
it
exceeds
the
liquidation
threshold.
Partial
or
full
liquidation
will
be
carried
out
if
required.

In
isolated
margin
mode,
funding
fees
will
now
be
collected
solely
from
the
margin
balance
of
isolated
positions,
and
orders
will
not
be
canceled
during
the
collection
process.
If
the
margin
balance
is
insufficient,
liquidation
will
follow
if
needed.

For
cross
margin
modes
(single-currency,
multi-currency,
and
portfolio
margin),
funding
fees
will
be
collected
from
cross
margin
equity
without
canceling
orders.
Insufficient
equity
will
trigger
partial
or
full
liquidation
as
necessary.

Distribution
of
Funding
Fees

The
distribution
of
funding
fees
will
also
undergo
changes.
Previously,
the
amount
distributed
was
proportional
to
the
position
value
of
users
due
to
receive
funding
fees.
Now,
the
platform
will
distribute
the
full
amount
during
settlement.

For
isolated
margin
positions,
the
funding
fee
will
be
added
to
the
margin
balance
of
the
position.
In
cross
margin
modes,
the
fee
will
be
added
to
cross
margin
equity.

Phased
Implementation

The
new
mechanism
will
be
implemented
in
four
phases:

• 
  First
  phase:
  June
  12,
  2024,
  at
  6:00
  am
  UTC,
  affecting
  five
  perpetual
  futures,
  including
  LINK-USD,
  LINK-USDT,
  LUNA-USDT,
  LUNC-USDT,
  and
  SHIB-USDT.
• 
  Second
  phase:
  June
  17,
  2024,
  at
  6:00
  am
  UTC,
  impacting
  32
  perpetual
  futures,
  such
  as
  ALPHA-USDT,
  SUI-USDT,
  SWEAT-USDT,
  and
  FIL-USD.
• 
  Third
  phase:
  June
  24,
  2024,
  at
  6:00
  am
  UTC,
  covering
  103
  perpetual
  futures,
  including
  AAVE-USDT,
  CETUS-USDT,
  GAL-USDT,
  and
  MAGIC-USDT.
• 
  Fourth
  phase:
  July
  1,
  2024,
  at
  6:00
  am
  UTC,
  affecting
  87
  perpetual
  futures,
  such
  as
  1INCH-USDT,
  BLOCK-USDT,
  FET-USDT,
  and
  LTC-USDT.

After
July
1,
2024,
all
perpetual
futures,
including
any
not
listed
above
or
newly
listed
ones,
will
follow
the
new
funding
rate
mechanism.

For
more
details,
visit
the

official
source.

Image
source:
Shutterstock

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