Introducing Prelaunch perpetual futures on WOO X
In crypto, few events can match the hype, speculation, and anticipation of major airdrops or token generation events (TGE) for high-profile projects.
During the premarket stage, where detailed information on tokenomics is usually scarce but speculation is rampant, the atmosphere can easily become highly charged. Some projects may spark controversy (such as STRK, ZK) due to ill-perceived token distribution, while others go on to generate significant positive momentum and community anticipation.
One thing is certain: with speculation comes the opportunity to hedge and profit. And that's where we aim to further empower our traders today with the launch of Prelaunch perpetual futures on WOO X.
What is the Prelaunch perpetual futures market?
Simply put, a prelaunch perpetual futures contract allows traders to speculate on the prices of tokens that have not yet been launched.
These instruments provide an opportunity to trade on the potential perceived value of these tokens, prior to their official release or TGE.
Traders who believe they have an edge may choose to participate in this early price discovery stage, in order to hedge against any downside risks, or profit from any potential undervaluation that has yet to be priced in by the market.
As an added benefit on WOO X, users who belong to VIP Tier 2 and above will receive maker rebates on their prelaunch perps trades.
Qualified for a big token airdrop and want to hedge the market early? This might be the right instrument for you.
How do Prelaunch perpetual futures work?
While prelaunch perpetual futures may look functionally similar to regular perpetual futures symbols on WOO X, there are some important differences to note.
Index price and funding
Unlike regular perpetual futures contracts, prelaunch perps do not have an index price and do not involve any funding payments for the trader.
Mark price
The mark price for prelaunch perps is calculated based on a 5-min moving average of the impact* bid and impact* ask prices, where the impact notional for prelaunch perps is set to be 200 USDT.
*Read this article for more information on the calculation of impact bid/ask.
Max leverage
Prelaunch perps may trade with high volatility. To ensure responsible trading, prelaunch perps will have a 1x max leverage with a 100% initial margin requirement, and a 60% maintenance margin requirement.
Price limits
To reduce potential volatility, there are set price limits on orders based on the current mark price.
- Max price of a buy order = 110% * ask1 price
- Min price of a buy order = 40% * mark price
- Max price of a sell order = 160% * mark price
- Min price of a sell order = 90% * bid1 price
Position limits
A maximum position notional of 100,000 USDT will be applied for prelaunch perps.
Going from prelaunch to launch
Once the token is launched and listed on major exchanges, the prelaunch perpetual futures contract will be seamlessly converted into a regular perpetual futures contract.
However, if the token doesn't launch or if WOO X decides to terminate the prelaunch contract before the token's release, the contract will be settled using the time-weighted average price (TWAP) of the mark price over the final hour before the settlement decision is announced.
Understanding risks and volatility
So now you understand how prelaunch perps work, but what about the risks? According to a report from Keyrock, premarket trading can be up to 20x more volatile than post-token launch trading.
Take Jupiter (JUP) as an example, where price volatility had surged to about 2,800% on various prelaunch markets before its official launch, and later dropping to around 150% one week post-launch.
In addition to shifting sentiment and the pricing-in of relevant project news, prices also often react to the liquidity conditions of the prelaunch markets.
We recommend that traders carefully assess their risks and trade responsibly. As the saying goes, "Only trade what you're comfortable losing."
Get started with Prelaunch perpetual futures
To access the prelaunch perps market on the WOO X desktop app, simply navigate over to the ‘Trade’ tab on WOO X, and click on ‘Prelaunch perps’.
If you’re on mobile, head over to the ‘Markets’ tab and select ‘Prelaunch’ to view all the available prelaunch perp symbols.
See you on the prelaunch markets!
Disclaimer
The information provided in this article is for general informational purposes only and does not constitute financial, investment, legal, or professional advice of any kind. While we have made every effort to ensure that the information contained herein is accurate and up-to-date, we make no guarantees as to its completeness or accuracy. The content is based on information available at the time of writing and may be subject to change.
Please note that this article includes references to third-party websites and data, which are provided solely for convenience and informational purposes. We do not endorse or assume any responsibility for the content, accuracy, or reliability of any information, products, or services offered by third parties.
Investments in prelaunch perpetual futures markets are subject to significant market risks, including the possible loss of all principal. The past performance of any financial asset does not guarantee future results. . The value of digital currencies can be extremely volatile, and you should carefully consider your investment objectives, level of experience, and risk appetite before participating in any investment activities.
We strongly recommend that you seek independent advice from a qualified professional before making any investment or financial decisions related to cryptocurrencies. We shall in NO case be liable for any loss or damage arising directly or indirectly from the use of or reliance on the information contained in this article.
All users and participants accept that:
He/She abides by the WOO X Terms and Conditions.
WOO X reserves the right, at its sole discretion, to modify, suspend, or discontinue the offering of any prelaunch perpetual futures markets at any time. WOO X further reserves the right to set and adjust the trading parameters, including but not limited to max leverage, price limits, position limits, funding rates and the method for determining the mark price, without prior notice.
The ability to trade prelaunch perpetual futures markets may be subject to restrictions as determined solely by WOO X.
Access to prelaunch perpetual futures markets and other related services may vary by user and can be limited based on various factors that WOO X may consider. WOO X does not guarantee the availability of its services to all users at all times.
The content of this document has been translated into different languages and shared throughout different platforms. In case of any discrepancy or inconsistency between different posts caused by mistranslations, the English version on our official website shall prevail.
By continuing to use WOO X’s services, you acknowledge that you have read and understood this disclaimer and agree to be bound by its terms.
