Perpetual Markets
Status: Planned
TEZEX plans to develop perpetual markets for Tezos assets.
Perpetual contracts allow traders to take leveraged long or short exposure without a fixed expiration date.
They create additional ways to speculate, hedge risk, manage portfolios, and provide professional liquidity around Tezos assets.
Long and Short Exposure
Section titled “Long and Short Exposure”A perpetual position can express either a bullish or bearish view.
Short markets are particularly useful for hedging.
A holder may want to protect against a temporary decline without selling the underlying asset.
A liquidity provider or market maker may want to offset directional exposure accumulated elsewhere.
Perpetuals create a common market for these forms of demand.
Margin and Leverage
Section titled “Margin and Leverage”Perpetual positions are supported by collateral.
The system continuously evaluates:
- collateral value;
- position size;
- entry price;
- profit and loss;
- leverage;
- maintenance margin;
- and liquidation thresholds.
This creates a continuously changing risk environment that requires responsive execution.
Funding
Section titled “Funding”Perpetuals do not expire, so funding mechanisms help keep the derivative aligned with its reference market.
Payments between longs and shorts create incentives that respond when the perpetual market moves away from the underlying reference price.
This creates an economic connection between spot and derivatives markets.
Oracles and Liquidations
Section titled “Oracles and Liquidations”Reliable reference prices are essential for margin calculations, funding, profit and loss, and liquidations.
Leveraged markets also require an orderly liquidation mechanism for positions that can no longer support their exposure.
Responsive pricing, execution, and liquidity therefore become core components of the perpetual-market architecture.
How Tezos X Enables Perpetuals
Section titled “How Tezos X Enables Perpetuals”Perpetual markets generate substantially more continuous activity than ordinary spot swaps.
Positions change value continuously.
Margin changes.
Funding accumulates.
Liquidations need to respond to risk.
Market makers hedge and rebalance.
The performance of Tezos X allows these processes to occur more responsively and at greater scale.
Deep underlying spot markets then provide pricing, hedging, arbitrage, and liquidation liquidity beneath the derivatives layer.