Settlement

Settlement Process

The settlement process includes two steps: automatic clearing and settlement via on-chain smart contracts. It adjusts the users' AvailableBalance to recognize the settlement amounts and deducts settlement fees while simultaneously destroying expired contracts. Settlement begins at 8:00 UTC on the contract expiration day (Friday) and is completed within one trading day.

Future Settlement

Future Settlement Price

The futures settlement price uses the SettleTWAP, denoted as $I^*$.

Future Settlement Amount

The futures settlement amount is determined by the difference between settlement and opening price, multiplied by the number of contracts settled, with settlement fees deducted from both long and short position holders.

Option Settlement

Option Settlement Price

Option settlement price is defined as:

$$OptionSettlePrice = \begin{cases} \max(0, I^* - K), & \text{Call Option} \\ \max(0, K - I^*), & \text{Put Option} \end{cases}$$

Option Settlement Amount

The option settlement amount is determined by the option settlement price multiplied by the number of contracts settled, with settlement fees deducted from long position holders only.