OKX Premarket Trading Preferred New Coin Contract Trading Tool Leading Frontier Innovation

OKX Premarket Trading Preferred New Coin Contract Trading Tool Leading Frontier Innovation

OKX Premarket Trading Preferred New Coin Contract Trading Tool Leading Frontier Innovation

OKX has launched an innovative pre-market trading feature that provides users with unique market opportunities.

Bitcoin and Ethereum initially dominated the cryptocurrency market, but with the rapid iteration and maturation of the industry, more and more emerging projects have emerged. The new coin market is an important part of the cryptocurrency field and plays a key role in industry innovation and development.

The changes in the total market value of the new coin market reflect the progress of innovative technology and the expansion of application scenarios, driving the evolution of the cryptocurrency industry. Its larger market penetration potential has increased global awareness and acceptance of cryptocurrencies. For example, emerging applications such as DeFi and NFTs meet users’ needs for financial innovation and digital art, and also promote the further development of the new coin market. As of July 2024, the total market value of the new coin market accounted for about 30%, reflecting its important position in the overall market.

In response to active user participation in the new coin market, OKX has officially launched pre-market trading, allowing users to trade delivery contracts for tokens that have not yet been listed. The aim is to provide users with a secure and reliable platform for price discovery of new tokens and lead the innovation of trading tools in the industry. Users can experience this feature by upgrading their OKX APP to version v6.7* or above.

About Pre-Market Trading
Key Elements
Bipolarity: Highlights and Risks
User Guide
Tool Innovation
OKX’s pre-market trading delivery contract is essentially a USDT-based delivery contract, which is usually delivered before the new token is listed on the spot trading market. Through OKX’s pre-market trading, users can trade delivery contracts for digital asset tokens that will be listed on the platform in advance, while enjoying 2x leverage.

In general, during the pre-market trading phase, users can profit from price fluctuations by going long or short. During the contract delivery phase, OKX’s pre-market delivery contracts are settled at a specific price on the delivery date. However, during the token listing phase, there is no guarantee that the pre-market delivery contract will be listed in the spot trading.

From the perspective of industry development, conducting delivery contract trading for tokens that have not yet been listed provides an effective price discovery and liquidity enhancement mechanism, as well as better risk management tools and market participation opportunities for users and project parties.

It is worth noting that OKX’s pre-market trading market differs from the standard delivery market in some product mechanisms. Key mechanisms will be interpreted below. The index price uses the latest transaction price of OKX’s pre-market trading delivery contract as the index price, which is also used to determine the delivery price of the contract.

A question that users are concerned about is whether OKX’s pre-market trading will affect the price of subsequent token listings on OKX. In fact, the price of the pre-market trading market is determined by the market behavior of buyers and sellers and may not accurately reflect the actual issuance price of the new token. Although pre-market trading can reflect market expectations, the listing price of the token may be influenced by other factors and is not directly related to the pre-market trading price.

OKX Pre-Market Trading
Contract Elements
Detailed Example
Underlying: XXX/USDT index (index is based on the latest transaction price of the contract)
Settlement crypto: USDT
Face value: 1 XXX
Price quotation: Quoted based on the USDT price of 1 XXX
Tick size: 0.0001
Leverage: 0.01 to 2x
Trading hours: 24/7
Contract type: Delivery contract
Settlement time: The contract delivery date is yet to be determined and will be announced separately

In addition, the core elements of OKX’s pre-market trading delivery contract have been extracted in the table below. Some key elements, such as settlement time and price, will be interpreted.

First, the settlement time.
1) If the new token is issued normally and is confirmed to be listed on OKX’s spot market, the pre-market trading delivery contract will be settled before the spot market listing of the token. The specific delivery date will be announced separately, and the settlement time will be displayed on the trading page.
2) If the project cancels the issuance of the new token, does not announce the token issuance plan within six months, or if there are other risk control issues, OKX may decide to terminate the contract in advance. The specific delivery date will be announced separately, and the settlement time will be displayed on the trading page.
3) For API users: The expTime field in the trading product (instruments) related interface returns the delivery date. The delivery date may change, and API users should pay attention to changes in expTime through push interfaces or regular query interfaces.

Second, leverage. OKX’s pre-market trading currently supports leverage from 0.01 to 2x, with a maximum leverage of 2x.

Third, gradient position and maximum position size rules. The maximum position size that a user can open is the maximum position size corresponding to the leverage selected by the user in the gradient position table. The maintenance margin quantity of the position is equal to the maintenance margin rate (MMR) corresponding to the position size in the gradient position table multiplied by the user’s position size.

Gradient Position and Maximum Position Size Rules
User Level
Maximum Position Size (USD)
Maintenance Margin Rate
Initial Margin Rate
Maximum Leverage
1
5,000
10%
50.00%
2
2
10,000
12%
50.00%
2
3
15,000
13%
100.00%
1
4
20,000
14%
100.00%
1
5
30,000
15%
100.00%
1
6
40,000
16%
100.00%
1
7
50,000
17%
100.00%
1
8
60,000
18%
100.00%
1
9
70,000
19%
100.00%
1
10
80,000
20%
100.00%
1
11
90,000
21%
100.00%
1
12
100,000
22%
100.00%
1
Note that the maximum position size in the gradient position table is in USD, and it needs to be converted into specific quantities based on the token price and contract face value:
Quantity = USD value / token price / contract face value / contract multiplier (specific quantity value refers to the token listing announcement)

Fourth, position limit rules. For pre-market trading contracts, the user’s maximum position size should meet the gradient position limit rules and the user’s position limit size at the same time. The position limit size is 100,000 USD for U-based contract designated market maker (DMM) users and 10,000 for non-U-based contract DMM users.

Position Limit Rules
User Type
Position Limit Size (USD)
Position Limit Size (Quantity)
U-based contract DMM users
100,000
Quantity = USD value / token price / contract face value / contract multiplier (specific quantity value refers to the token listing announcement)
Non-U-based contract DMM users
10,000

By using OKX’s pre-market trading, users can meet various needs. For example, they can participate in trading before the token is officially launched, seize market opportunities, and gain early access. By understanding the value expectations of tokens before they are officially launched, the activity and market response of pre-market trading can enhance the community’s confidence in token projects. Through actual trading data, it verifies market demand and project potential, and increases price discovery opportunities and trading transparency.

Furthermore, users can lock in prices before the token is officially launched, hedge price volatility risks through delivery contract trading, and thereby mitigate the uncertainty brought by market fluctuations. They can also have more trading strategy choices and adjust trading portfolios flexibly according to market conditions. In summary, through OKX’s pre-market trading, users can make more proactive and flexible trading decisions in the cryptocurrency market, enjoying more market opportunities and higher trading efficiency.

Although OKX continuously strives to provide a better trading experience, pre-market trading contracts have high risks as pre-market markets are more prone to reduced liquidity and higher price volatility. Users also face greater liquidation risks. Not all tokens traded in pre-market contracts will eventually be listed on OKX.

Currently, OKX reserves the right to adjust the listing, extension, or termination of contracts, as well as the contract settlement date.

It is important to note that pre-market contracts have fixed expiration dates, which are linked to the listing of the relevant underlying tokens. Upon expiration, settlements will be made in USDT only. Therefore, users are not trading the underlying tokens and should not expect to receive the underlying tokens upon contract expiration. Additionally, since the trading is conducted before the listing of the underlying tokens, the underlying tokens do not have a clearly identifiable price source, so the contract price may differ from the listing and post-listing prices of the underlying tokens. OKX reserves the right to suspend or terminate such pre-market contract trading at any time.

How to Use OKX Pre-Market Trading?
Open the OKX App, click on “Trading,” and select “Pre-Market Trading.” Alternatively, click on “More” in the upper left corner and select “Pre-Market Trading.”
Using ABCD as an example, click on “Trade Now” and enter the currency trading interface for the token.
Pre-market trading is only available in isolated mode. You can freely modify the leverage by clicking on the leverage multiplier, with a maximum leverage of 2x. The other operation processes are similar to most trading processes, where you can set order modes, prices, costs, and other parameters to go long or short.

From an industry perspective, OKX’s pre-market trading demonstrates its strong technological innovation and ability to respond to user needs, bringing more trading modes and tools to the cryptocurrency market. This can attract more users and liquidity, and help the market discover and determine token prices in advance. This price discovery mechanism contributes to forming market consensus before tokens are officially launched, making market prices more transparent and stable, and promoting industry progress.

From a user perspective, pre-market trading allows users to hedge price volatility risks before tokens are officially released, avoiding potential price volatility risks after listing, and achieving more effective risk management. Users also have the opportunity to participate in new projects earlier, allowing them to take earlier positions and break through limitations.

From a project perspective, OKX’s pre-market trading provides an additional liquidity channel for new tokens. Through delivery contracts, traders can buy and sell operations before the token is listed, increasing market activity and liquidity. This enables new projects to gain market attention and funding support before formal trading. Additionally, new token projects can showcase their market demand and user interest before listing. This not only enhances the confidence of project parties but also increases trust from potential users and communities, contributing to the success of projects after listing.

However, every tool has two sides, and OKX’s pre-market trading is no exception. While it provides opportunities, it also brings risks. Users need to conduct a comprehensive evaluation before participating and should not blindly engage. The new coin market is like a dazzling star in the cryptocurrency world, shimmering with infinite possibilities. OKX’s launch of the pre-market trading feature enhances this possibility.

Disclaimer
This article is for reference only. It represents the author’s views and not the position of OKX. This article does not intend to provide (i) investment advice or investment recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; (iii) financial, accounting, legal, or tax advice. We do not guarantee the accuracy, completeness, or usefulness of such information. Holding digital assets (including stablecoins and NFTs) involves high risks and may experience significant volatility. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. For your specific circumstances, please consult your legal/tax/investment professionals. Please be responsible for understanding and complying with applicable local laws and regulations.

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