Introduction to Perpetual Futures Exchange

Product Details

Perpetual Futures allow users to have leveraged long or short exposure on assets without an expiration date. In place of expiration, users pay ongoing fees (as unrealized P/L in the positions) while the positions are open. This comes with many benefits. Having the ability to keep a position open “perpetually” has the advantage of avoiding the cost and inconvenience of having to completely roll over a position when it expires. It also makes it simple to quickly adjust the position on the fly which is great for responsive hedging.
The biggest benefit though is it allows aggregating liquidity into one market, whereas otherwise, the liquidity would be fragmented across products and contracts for various time periods. The aggregated deep liquidity allows for high leverage that is difficult to find on-chain for non-perpetual products such as options. This high leverage is suitable both for trading and hedging large positions.
Our particular implementation of Perpetual Futures Exchange also has other advantages such as offering the ability to open and close positions with no slippage, which further facilitates opening positions that are large, high leverage, and/or short term.
There are two main user groups for the Exchange — Traders and Liquidity Providers. In the below sections, we will discuss the key features and benefits each of them will get from using the product.

Benefits to ALPACA holders

Similar to other products launched under the Alpaca brand, protocol revenue generated will be directed towards xALPACA holders and/or burn. We will share the exact parameters closer to the launch date.