contango
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Types of contracts
At launch we will offer ETHDAI and ETHUSDC, with their respective inverse contracts.
Please bear in mind that our inverse contracts are simply linear contracts that offer the opposite pair. In other words, compared with CeFi, our inverse contracts have two major differences (also marked in green in the table below):
  • They have a different pair name. E.g. the inverse of ETHDAI is the pair DAIETH.
  • For this reason, just like a linear contract, they're quoted in the quote currency. E.g. the DAIETH contract is quote in ETH.
In a nutshell, going long on ETHDAI could be seen as going short on DAIETH. And viceversa.
You can use inverse contracts to post the margin you prefer. For instance, if you have ETH and want to hedge your position by shorting it with a futures you can go on Contango and post it as margin on the inverse contract, e.g. DAIETH.

Example with an inverse contract:

A trader goes long 100 DAI of DAIETH futures, which trade at a price of 0.01 ETH.
With a MR of 50%, the trader only needs to post 0.5 ETH as margin.
A few days later, the price rises to 0.011 ETH and the trader closes her position.
The trader’s PnL will be: 100* (0.011-0.01) = 0.1 ETH

Summary

Text
Linear (CeFi)
Linear (Contango)
Inverse (CeFI)
Inverse (Contango)
Pair
ETHDAI
ETHDAI
ETHDAI
DAIETH
Quoted in
DAI
DAI
DAI
ETH
Settled in
DAI
DAI
ETH
ETH
PnL in
DAI
DAI
ETH
ETH
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Summary