To improve the platform performance of AAX, and in the interest of our valuable customers, AAX is introducing the Mark Price methodology of calculating the liquidation price of futures contracts. This will serve to ensure a fairer liquidation price in the event of sudden changes in volume and will reduce the risk of liquidation and eliminate the impact of price manipulation.
The Mark Price is calculated using a static average of futures contracts of up to seven crypto exchange platforms, including Bitstamp, Bittrex, Coinbase, Gemini, Kraken, Poloniex, and ItBit. It will be recalculated every 10 seconds to ensure the accuracy of our calculation.
Prior to introducing the Mark Price methodology, liquidation prices were calculated using the last trading price. To improve customer experience, AAX will use the Mark Price methodology, to calculate liquidation levels, which should also avoid contracts being liquidated prematurely in the event of a sudden change in volumes.
The Mark Price will be shown under “Open Position” as below: