As part of its ongoing commitment to improving market efficiency and ensuring stable price alignment between derivatives and spot markets, OKX has implemented strategic adjustments to the price limit rules for both delivery and perpetual contracts, as well as updated the funding rate mechanisms for perpetual contracts. These changes are designed to enhance market liquidity, reduce volatility risks, and ensure that perpetual contract prices remain closely anchored to their underlying index values.
The updates were rolled out in two phases:
- Perpetual contract rule adjustments took effect on October 16, 2020, at 16:00 HKT, with the first funding fee settlement under the new rules occurring at 08:00 HKT on October 17, 2020.
- Delivery contract price limit adjustments were implemented on October 22, 2020, at 17:00 HKT.
These refinements reflect OKX’s data-driven approach to risk management and user protection in fast-moving crypto derivatives markets.
Understanding the Updated Price Limit Rules
Price limits play a crucial role in preventing excessive volatility and ensuring fair trading conditions. They define the upper and lower boundaries within which contract prices can fluctuate relative to the spot index price.
How Price Limits Are Calculated
OKX uses a dynamic formula that adjusts based on market conditions and time since contract listing:
During the First 10 Minutes After Contract Launch:
- Maximum Price:
Index × (1 + X) - Minimum Price:
Index × (1 - X)
This initial cap helps stabilize new contracts during high-sensitivity periods.
After the First 10 Minutes:
The formula becomes more adaptive:
- Maximum Price:
Min[Max(Index, Index × (1 + Y) + Average Premium Over Last 10 Minutes), Index × (1 + Z)] - Minimum Price:
Max[Min(Index, Index × (1 - Y) + Average Premium Over Last 10 Minutes), Index × (1 - Z)]
This structure allows for responsiveness to real-time market premiums while still enforcing hard limits through Z-values.
👉 Discover how advanced pricing models protect your trades on high-volatility assets.
Adjusted Parameters for Delivery Contracts
To better align with market depth and maturity of longer-term instruments, OKX has refined the X, Y, and Z parameters across different delivery contract types:
Weekly & Biweekly Contracts (All Cryptocurrencies - USDⓈ-M and Coin-M)
- X = 5%
- Y = 4%
- Z = 15%
Quarterly & Next-Quarter Contracts (All Cryptocurrencies - USDⓈ-M and Coin-M)
- X = 5%
- Y = 6%
- Z = 25%
Notably, for weekly contracts, the Z value is reduced to 1% during the final 30 minutes before settlement, minimizing last-minute manipulation risks and supporting smoother delivery processes.
These adjustments ensure tighter control over short-term fluctuations while allowing sufficient flexibility for legitimate price discovery in longer-dated contracts.
Tiered Adjustments for Perpetual Contracts
Perpetual contracts now follow a three-tiered model based on asset liquidity, trading volume, and market stability. This tiered system enables more precise risk calibration across diverse digital assets.
Tier 1 – High-Liquidity Assets (e.g., BTC, ETH, LTC, XRP, EOS, BCH, TRX, LINK, DOT)
- X = 2%
- Y = 2%
- Z = 5%
These tight limits reflect strong market depth and low susceptibility to manipulation.
Tier 2 – Mid-Tier Liquidity Assets (e.g., DOGE, ADA, ATOM, AVAX, ALGO, NEO, ZEC, COMP, UNI)
- X = 4%
- Y = 4%
- Z = 8%
This broader range accommodates moderate volatility while maintaining stability.
Tier 3 – Emerging or Lower-Liquidity Assets (e.g., CRV, SUSHI, FIL, SUN)
- X = 6%
- Y = 6%
- Z = 15%
Higher thresholds allow for natural price swings without triggering unnecessary circuit breakers.
This tiered framework ensures that each asset class is governed by rules proportional to its market characteristics.
Funding Rate Rule Enhancements
Funding rates help maintain parity between perpetual contract prices and spot index levels by incentivizing traders to balance long and short positions.
Funding Rate Formula
The funding rate is calculated as:
Funding Rate = Clamp[ MA( ((Bid + Ask)/2 - Index Price) / Index Price − Interest ), a, b ]Where:
MA= moving average over a specific windowInterest= currently set to 0aandb= lower and upper bounds (now adjusted)
Updated Clamp Bounds (a and b)
| Asset | Lower Bound (a) | Upper Bound (b) |
|---|---|---|
| BTC | -0.375% | 0.375% |
| All Other Coins | -0.75% | 0.75% |
Bitcoin’s tighter band reflects its mature market status and historically stable funding dynamics. Other cryptocurrencies have wider bands to account for higher volatility and less predictable demand imbalances.
This adjustment reduces extreme funding events and promotes smoother position management for traders.
👉 Learn how intelligent funding rate caps minimize unexpected costs in volatile markets.
Frequently Asked Questions (FAQ)
Q: Why did OKX update the price limit and funding rate rules?
A: The updates aim to improve market stability, enhance liquidity, and ensure perpetual contracts stay closely tied to spot prices. By tailoring parameters to asset tiers and contract types, OKX provides a safer and more efficient trading environment.
Q: How do these changes affect my open positions?
A: The changes do not impact existing positions directly but may influence how prices move within defined bands and how funding fees are calculated. Traders should review the new limits and expected funding ranges when managing leveraged positions.
Q: What is the purpose of the tiered system for perpetual contracts?
A: It allows OKX to apply appropriate risk controls based on an asset’s liquidity and volatility. Highly traded assets like BTC get tighter controls, while newer or less liquid tokens have more flexible bounds.
Q: When are funding fees charged under the new rules?
A: Funding occurs every 8 hours (at 00:00, 08:00, and 16:00 UTC). The first charge under the updated clamp values was applied at 08:00 HKT on October 17, 2020.
Q: Are delivery contracts also subject to funding rates?
A: No. Funding rates apply only to perpetual contracts. Delivery contracts settle at expiration based on the index price, so they do not require periodic funding payments.
Q: How can I check the current funding rate for a contract?
A: The funding rate is displayed in real-time on the trading interface and within the contract details section on both web and mobile platforms.
Final Thoughts
OKX continues to lead in derivatives innovation by combining robust risk controls with adaptive market mechanics. The revised price limit formulas, tiered parameter system, and refined funding rate caps collectively strengthen platform resilience and trader confidence.
Whether you're trading high-volume majors like Bitcoin or exploring opportunities in emerging altcoins, these updates ensure a fairer, more transparent trading experience.
👉 Explore advanced contract features built for precision and protection in evolving markets.
By continuously optimizing its infrastructure based on real-world data and user feedback, OKX reinforces its position as a trusted platform for digital asset derivatives trading.