How does settlement work for OKX daily futures contracts?

Understanding OKX Daily Futures Contracts

OKX daily futures contracts are perpetual contracts with a 24-hour settlement cycle, meaning they are not designed to last indefinitely like traditional perpetual swaps. Instead, they settle every 24 hours at a fixed UTC time, which is typically 08:00 UTC. This settlement process is automatic and applies to all open positions at that time. The primary goal of this design is to reduce funding rate volatility and provide traders with a predictable exit mechanism without requiring manual closure.

Each daily futures contract has a specific expiration timestamp, and as that time approaches, the contract’s price converges toward the underlying index price. This convergence ensures fairness and minimizes manipulation risk. The settlement is based on the mark price, which is derived from a time-weighted average price (TWAP) of the contract over the final minutes before settlement. This prevents price spikes or flash crashes from influencing the final settlement value.

Settlement Mechanism and Price Determination

The settlement price for OKX daily futures is calculated using a 30-minute time-weighted average price (TWAP) of the mark price, starting from 07:30 UTC to 08:00 UTC. This method ensures that the final price reflects a stable and representative market value rather than a single volatile data point.

• The mark price is used instead of the last traded price to avoid manipulation.
• The TWAP is computed from data sampled every few seconds during the 30-minute window.
• Once the 08:00 UTC timestamp is reached, the system locks in the final settlement price.
• All open positions are automatically closed at this settlement price, and profits or losses are credited to the trader’s wallet.

This process ensures transparency and fairness. For example, if you hold a long position in BTCUSD daily futures and the TWAP settlement price is $60,000, your position will be closed at that rate regardless of the current market bid/ask.

Liquidation and Margin Handling During Settlement

Before settlement occurs, OKX continuously monitors all open positions for liquidation risk. If a trader’s margin balance falls below the maintenance margin level due to adverse price movement, the position may be liquidated before the 08:00 UTC settlement.

• Liquidation happens independently of the settlement process.
• If a position is liquidated earlier in the day, it does not participate in the 08:00 UTC settlement.
• Traders who maintain sufficient margin throughout the day will have their positions settled automatically.
• After settlement, the final PnL (Profit and Loss) is calculated and transferred to the user’s futures wallet.

It is crucial to maintain adequate margin, especially as the settlement time approaches. Using stop-loss orders or take-profit orders can help manage risk without relying solely on the automatic settlement.

Post-Settlement Process and Fund Allocation

Once the settlement is complete, the system performs several backend operations to finalize the trading cycle.

• All settled positions are removed from the open positions list.
• The realized PnL from the settled contract is credited to the user’s futures wallet balance.
• Traders can immediately withdraw these funds or use them to open new positions.
• A new daily futures contract for the same asset is listed immediately after settlement, allowing continuous trading.

For instance, after the BTCUSD daily futures contract settles at 08:00 UTC, a new contract with the same specifications but a new 24-hour cycle begins trading. This ensures uninterrupted market access. The contract naming convention usually includes the date and time, helping traders identify the correct instrument.

Trading Strategies Around Daily Settlement

Traders can leverage the predictable nature of daily settlements to design specific strategies.

• Arbitrage between spot and futures: As the settlement time nears, the futures price converges with the spot index. Traders can exploit minor discrepancies before convergence.
• Carry trades: Since daily futures do not have recurring funding fees like perpetuals, traders can hold positions without paying or receiving funding every 8 hours.
• Intraday momentum plays: Traders can enter positions early in the 24-hour cycle and exit before settlement to capture short-term moves without waiting for automatic closure.

Using limit orders near the expected settlement range can help secure favorable exit prices. Additionally, monitoring the funding rate differentials between perpetual and daily futures can reveal opportunities, as daily futures often exhibit lower funding volatility.

How to Monitor Settlement Status on OKX

OKX provides real-time tools for tracking the settlement countdown and price convergence.

• Navigate to the Futures Trading Interface on the OKX website or app.
• Select the Daily Futures tab under the contract list.
• Observe the countdown timer displayed next to each active daily contract.
• Check the mark price chart and compare it with the index price to monitor convergence.
• View the settlement history in the account statement to verify past settlements.

The platform also sends push notifications or email alerts as settlement approaches, depending on user preferences. Traders should ensure notifications are enabled to stay informed. In the event of technical issues, OKX publishes official announcements on its status page.

Frequently Asked Questions

What happens if I don’t close my daily futures position before 08:00 UTC?If you do not manually close your position, it will be automatically settled at the 30-minute TWAP price at 08:00 UTC. You do not need to take any action—the system handles the closure and credits your account with the realized PnL.

Can I reopen a position in the same asset immediately after settlement?Yes. A new daily futures contract for the same asset is listed right after settlement. You can open a new position in the freshly launched contract as soon as it becomes available on the trading interface.

Is the settlement price the same for all users?Yes. The settlement price is uniform and based on the global TWAP of the mark price. Every user, regardless of their entry price or position size, has their position closed at this single, publicly verifiable rate.

Are there fees associated with daily futures settlement?No separate settlement fee is charged. However, standard taker and maker trading fees apply when you open or close positions. The settlement itself is a free, automated process.