Futures

Stocks, commodities and real-world tokenization will be offered on DeFiChain via futures contract, offered by Operators.

Future is offered by operators with the assistance of price oracles, allowing prices of assets to be tracked, real world or otherwise.

DeFiChain will support 2 types of futures:

  1. Fixed expiry
  • With a fixed expiry at a certain date in the future.
  • At the time of expiry,
  1. Perpetual swap
  • With funding mechanics

Mechanics

  1. Margin contract
  • Trader is able to fund their Future trading position through this margin contract.
  • Contract can be funded with DFI and other tokens that operators decide, e.g. BTC.
  • Operator can also define initial margin and maintenance margin for a margin contract.
  1. Asset
  • Operator decide assets to list.
  • Assets can be stocks, commodities or anything that has a price. It is operator's responsibility to ensure that there are good price oracles for traded assets.
  1. Order
  • User is able to make an order. It can be a long or short order.
  • Orders are matched automatically on-chain.
  1. Settlement
  • Fixed expiry future will be settled automatically based on settlement oracle price published.
  • Perpetual swap future has no settlement. There is instead a funding rate mechanism.
  1. Perpetual swap funding
  • Funding rate is automatically determined by DeFiChain based on fixed algorithm: oracle price, perpetual swap trading price.
  • Funding period can be set by operator, but it should be between 1x to a max of 12x per day. For reference, most centralized perpetual swap offerings have a 8h funding interval (3x per day).
  1. Liquidation
  • When net margin (total margin + unrealized PnL) is less than maintenance margin, forced liquidation would occur.
  • TBD: Either automated, operator-run, or community-run with incentives.

Enahncements

  1. Future can further be enhanced to allow leverage. DeFiChain will start with no leverage (1x) and will introduce leverage once the mechanisms are stable.

RPC

TK