What time does the BitFlyer contract settle?

BitFlyer futures contracts generally settle on the last trading day of the contract month, at specific times depending on the contract type.

Nov 12, 2024 at 10:00 am

What Time Does the BitFlyer Contract Settle?

BitFlyer, a leading Japanese cryptocurrency exchange, offers a variety of futures contracts for trading digital assets. These contracts allow traders to speculate on the future price of an underlying asset, such as Bitcoin or Ethereum. One important aspect of futures trading is understanding the settlement time of the contract.

What is Contract Settlement?

Contract settlement refers to the process of finalizing a futures contract at its expiration date. During settlement, the buyer and seller exchange the underlying asset for payment. In the case of cryptocurrency futures, the underlying asset is typically the digital asset being traded, such as Bitcoin or Ethereum.

BitFlyer Futures Contract Settlement Time

BitFlyer futures contracts generally settle on the last trading day of the contract month. The specific settlement time for each contract is provided in the contract specifications and is typically as follows:

• Coin (BTC/USD, BTC/JPY): 11:00 AM (UTC+8) on the last trading day
• FX (USD/JPY): 5:00 PM (UTC+8) on the last trading day

Settlement Process

When a BitFlyer futures contract settles, the following process occurs:

• Mark Price Determination: The mark price, which represents the fair market value of the underlying asset at the time of settlement, is calculated using a weighted average of executed trades during the last 24 hours.
• Settlement Price Calculation: The settlement price is typically derived from the mark price at the time of settlement. For coin contracts, the settlement price is usually the mark price multiplied by the contract multiplier.
• Exchange of Assets: The buyer receives the underlying asset in exchange for the contract price, while the seller receives the contract price in the form of payment. The payment is typically made in the quote currency of the contract, such as USD for BTC/USD futures.

Exceptions

In certain cases, the settlement process may differ from the standard procedure:

• Deliverable Contracts: For deliverable futures contracts, the underlying asset is physically exchanged between the buyer and seller. The settlement process involves transfer of the asset from the seller's wallet to the buyer's wallet.
• Cash-Settled Contracts: For cash-settled futures contracts, the contract is settled in cash, rather than through the exchange of the underlying asset. The settlement price is used to determine the cash amount exchanged.

Importance of Settlement Time

Understanding the settlement time of BitFlyer futures contracts is important for several reasons:

• Plan Trading Strategies: Traders need to know when the contract will settle to plan their trading strategies accordingly.
• Avoid Contract Expiration: Traders who hold contracts past their expiration date may be subject to automatic liquidation, resulting in potential losses.
• Profit Realization: The settlement time determines when traders can realize their profits or losses from futures trading.