1. CoinBene adopts Fair Price Marking to avoid unnecessary liquidations in its highly leveraged products. Without this system, when the market is being manipulated or illiquid, the mark price may swing unnecessarily relative to its index price, leading to an unnecessary liquidation.
2. Fair Price Marking is adopted for unrealized PNL, liquidations and ADL.
3. Note: When you open a position, you may see a positive or negative unrealized PNL immediately. This happens when the fair price is slightly different from the fill price. This is normal and does not mean you have lost asset, but be sure to pay attention to your Liquidation Price to avoid a premature liquidation.
Calculation of the Fair Price Marking
1. The fair price of the perpetual contract is calculated based on the funding basis:
2. Funding Basis = Funding Rate* (Time to Next Funding Payment / Time Interval of Funding)
3. Fair Price = Index Price* (1 + Funding Basis)