1. What are Pre-Market Perpetual Contracts?
XT Pre-Market Perpetual Contracts are USDT-margined perpetual contracts that allow users to trade upcoming crypto assets before they are officially launched or listed on the spot market. Identical to standard perpetual contracts, Pre-Market Perpetual Contracts have no expiry or delivery dates and support continuous trading. However, during the pre-market phase, their market price, mark price, and funding rate mechanisms differ from those of standard perpetual contracts.
Once the underlying crypto asset meets specific criteria (e.g., listing on eligible spot exchanges, stabilization of the price index, etc.), the system will smoothly transition the Pre-Market Perpetual Contracts into Standard Perpetual Contracts.
2. Differences: Pre-Market Perps vs. Standard Perps
| Comparison Item | Pre-Market Perpetual Contracts | Standard Perpetual Contracts |
| Index Price | None (underlying token not yet listed on spot) | Calculated based on spot prices from multiple exchanges |
| Opening Price | Based on the reference price of the underlying asset | Determined by the market |
| Mark Price | Calculated based on pre-market fill prices, protected by a second-by-second price limit | Calculated based on Index Price + Moving Average Basis |
| Funding Rate | Fixed Rate (Premium Index is not applicable) | Fixed Interest Rate + Premium Index |
| First 5 Mins of Opening | Limit Orders only | No such restriction |
| Leverage | Capped by platform-defined limits for the Future (Recommended less than 5x leverage) | Standard leverage limits apply |
| Liquidity | Typically lower, with higher price volatility | Typically higher |
| Copy Trading | Not supported due to thin liquidity | Fully supported |
| Transition Mechanism | Automatically converts to a standard perp future once conditions are met | — |
3. The Three Phases of a Pre-Market Perpetual Contract
A Pre-Market Perpetual Contract goes through three distinct stages in its lifecycle:
- Pre-Market Phase: The underlying asset is not yet listed on the spot market. The future operates under pre-market mechanisms.
- Transition Phase: Transition conditions are met. The mark price smoothly converges toward the index price according to a set formula.
- Standard Perpetual Phase: The transition is complete, and the future functions fully as a Standard Perpetual Contract.
4. Mark Price Rules
4.1 During the Pre-Market Phase
Since there is no index price available during the pre-market phase, the mark price is calculated every second based on the actual fill prices of the pre-market future:
- The mark price is the average of the execution prices over the past 10 seconds, updated every second.
- If there are fewer than 21 executions in the past 10 seconds, the mark price will be the average of the last 20 execution prices of the future.
- If the total historical execution count is less than 20, the mark price will be the average of the last N execution prices (where N = current total historical execution count).
4.2 During the Transition to Standard Perpetual Contracts
When the index price becomes available, the mark price during the transition phase is calculated as follows():
$$\text{Mark Price} = \beta \times (\text{Index Price} + \text{Moving Average of Basis}) + (1 - \beta) \times (\text{Moving Average of Last Price})$$
- Parameter Definition: $$\bet$$ represents the transition smoothing factor, where $$\beta \in (0, 1$$, measured on a second-by-second basis.
4.3 Post-Transition to Standard Perpetual Contracts
Once the future enters the Standard Perpetual phase, the standard mark price calculation, index price mechanism, and funding rate mechanism will be fully applied. Meanwhile, the future will be officially removed from the "Pre-Market" section of the market list, and the "Pre-M" tag will be hidden.
5. Funding Rate
The funding rate consists of a fixed interest rate and a premium index(). Since there is no premium index during pre-market trading, the funding rate is charged as a fixed rate():
| Phase | Funding Rate Formula |
| Pre-Market Phase | Funding Rate= Fixed Rate (a predetermined value set by the platform) |
| Transition Phase | Same as the Pre-Market Phase (Fixed Rate) |
| Standard Perpetual Phase | Funding Rate = Fixed Rate+ Premium Index |
Notes: * The settlement cycle for funding fees is identical to that of standard Perpetual Contracts. Please refer to the future details page for the exact "Funding Fee Settlement Time."
XT reserves the right to adjust the rate based on market conditions. If the settlement frequency is adjusted to hourly in the future, an official announcement will be released in advance.
6. Leverage and Price Protection Mechanisms
To effectively mitigate market risks and protect user assets and trading stability, XT applies the following additional restrictions to Pre-Market Perpetual Contracts:
- Leverage Restrictions: Due to the risk profile of pre-market trading, the maximum leverage for these futures is strictly capped at 10x (conceptually not exceeding 10x). Users are advised to evaluate risks rationally and choose leverage cautiously.
- Price Protection Mechanism: During the pre-market phase, a $$\pm1\$$ second-by-second price movement limit is applied to the mark price. This mechanism prevents sharp jumps in the mark price caused by anomalous executions, thereby reducing the risk of accidental liquidations.
7. Frequently Asked Questions (FAQs)
Q1: What is the difference between Pre-Market Perpetual Contracts and Spot Pre-listing?
A: Spot Pre-listing typically refers to the subscription or pre-trading phase of a token before its official spot launch. Pre-Market Perpetual Contracts, on the other hand, are USDT-margined perpetual derivatives that allow users to go long or short on unlisted tokens with no expiry date. The mechanisms and risk profiles of the two products are entirely different.
Q2: Why is there no Index Price during the Pre-Market Phase?
A: The Index Price relies on real-time spot execution prices across multiple exchanges. Before the underlying token is officially listed on the spot market, there is no reliable market price reference. Therefore, no index price is provided during the pre-market phase, and the mark price is calculated using the future's own transaction data.
Q3: Why are Market Orders disabled during the first 5 minutes of opening?
A: To prevent market orders from executing at prices that deviate severely from reasonable levels due to thin liquidity at the exact moment of opening. The platform restricts trading to Limit Orders only for the first 5 minutes. All order types will resume normal functionality once the countdown ends.
Q4: What does the $$\pm1\$$ movement limit on the Mark Price mean?
A: The mark price of the pre-market future is subject to a $$\pm1\$$ price limit, meaning the change in mark price between consecutive seconds cannot exceed $$\pm1\$$. This limit applies to both the pre-market trading phase and the transition phase.
Q5: When will the future transition from Pre-Market to Standard Perpetual?
A: The future will be converted into a Standard Perpetual Contract once the underlying token is listed on at least three major spot exchanges and the market satisfies XT's requirements for standard perps. The exact transition time is determined at XT's sole discretion and will only take place when the market is stable.
Q6: Will my positions and open orders be affected during the Transition Phase?
A: No. Your positions will remain unchanged, open orders will stay valid, and order matching will not be interrupted. The mark price will smoothly converge to the index price according to the formula, avoiding any sudden price spikes caused by the mechanism switch.
Q7: What happens to my positions if the project is officially canceled?
A: The platform will issue an announcement in advance and suspend opening new positions (while keeping closing positions open）. Upon reaching the settlement time, all outstanding positions will be settled at the final settlement price confirmed in the announcement. The final settlement price is usually the average of the second-by-second mark prices during the 60 minutes prior to settlement. If the project has effectively gone to zero, the platform may use a custom minimum price for settlement. Please refer to the specific official announcement for details.
Q8: Why is Copy Trading not recommended for Pre-Market Futures?
A: Pre-market futures often suffer from thinner liquidity and higher price volatility. Copy trading in these environments can lead to amplified slippage and cascading liquidations, which is highly unfavorable for both lead traders and followers. Therefore, copy trading is not supported [or strongly discouraged] during the pre-market phase.
Q9: How can I identify whether a future is currently in the Pre-Market Phase?
A: Futures displayed under the "Pre-Market" section of the market list are in the pre-market phase. Once a future transitions into a Standard Perpetual Contract, it will be removed from the "Pre-Market" section.
Q10: Can I view the Index Price K-line chart during the Pre-Market Phase?
A: No. There is no index price during the pre-market phase. When switching the K-line chart to "Index Price," the page will prompt: "Index price display is not supported for Pre-Market Futures. Please switch to Last Price or Mark Price." Please use the "Last Price" or "Mark Price" tabs to view price trends.