OKX provides users with unique market opportunities through its innovative pre-market trading feature.
Bitcoin and Ethereum initially dominated the cryptocurrency market, but with the rapid iteration and maturation of the industry, an increasing number of emerging projects have begun to emerge. The new coin market is a vital component of the cryptocurrency sector, playing a crucial role in innovation and development within the industry.
Changes in the market capitalization share of the new coin market reflect advancements in innovative technologies and the expansion of application scenarios, driving the evolution of the cryptocurrency landscape. Its significant market penetration potential enhances global awareness and acceptance of cryptocurrencies. For instance, emerging applications like DeFi and NFTs meet users’ demands for financial innovation and digital art, subsequently furthering the development of the new coin market. As of July 2024, the total market capitalization share of the new coin market is approximately 30%, demonstrating its important position within the overall market.
In response to active users’ enthusiasm for participating in the new coin market, OKX has officially launched the pre-market trading feature, allowing users to trade contracts for tokens that have not yet been listed. This aims to provide users with a secure and reliable platform for participating in price discovery of new tokens and to lead innovation in trading tools within the industry. Users can experience this feature by upgrading the OKX App to version 6.7* or above.
**Table of Contents**
– About Pre-Market Trading
– Core Element Interpretation
– Dual Nature: Highlights and Risks
– Usage Tutorial
– Tool Innovation
The essence of OKX’s pre-market trading contracts is that they are USDT-based contracts, typically settled before new tokens go live in the cryptocurrency trading market. Through OKX’s pre-market trading, users can trade digital asset contracts ahead of the official listing, taking advantage of 2x leverage.
Generally, during the pre-market trading phase, users can gain profits from price fluctuations through long or short positions. During the contract settlement phase, OKX pre-market contracts will settle at a specific price on the settlement date; however, during the token listing phase, there is no guarantee that the token will ultimately be listed on the spot market.
From an industry development perspective, trading contracts for tokens that are yet to be listed not only provides an effective mechanism for price discovery and liquidity enhancement but also offers users and project teams better risk management tools and market participation opportunities.
It is noteworthy that the OKX pre-market trading market differs from the standard settlement market in some product mechanisms. For instance, the index price uses the latest transaction price of OKX pre-market trading contracts as the index price, which is also used to determine the contract’s settlement price.
A common concern among users is whether OKX pre-market trading will affect the subsequent price of tokens listed on OKX. In fact, the price in the OKX pre-market trading market is determined by the market behavior of buyers and sellers, and this price may not accurately reflect the actual issuance price of the new token. Although pre-market trading can reflect market expectations, the actual listing price of the token may be influenced by various other factors, and the two are not directly correlated.
**OKX Pre-Market Trading Contract Elements**
– Contract Underlying: XXX/USDT Index (index taken from the latest transaction price of the contract)
– Settlement Cryptocurrency: USDT
– Contract Face Value: 1 XXX
– Price Quotation: Quoted at the USDT price of 1 XXX
– Minimum Tick Size: 0.0001
– Leverage: 0.01 ~ 2x
– Trading Hours: 24/7
– Contract Type: Settlement Contract
– Settlement Time: The contract settlement date has not yet been determined and will be announced separately once confirmed
In addition, the following table distills the core elements of OKX pre-market trading contracts, which will be interpreted further, focusing on aspects such as settlement time and price.
First, Settlement Time.
1) If the new token is normally issued and confirmed to be listed on OKX’s trading market, the pre-market trading contract will be settled prior to the token’s official market listing. The specific settlement date will be notified through an announcement, and once determined, it will be displayed on the trading page.
2) If the project party cancels the new token issuance or does not announce a token issuance plan within six months, or due to other risk control issues, the platform decides not to list it on OKX’s trading market, OKX may preemptively delist the contract. The specific settlement date will be notified via an announcement, and once confirmed, it will be displayed on the trading page.
3) For API users: The expTime field in the transaction product-related interface returns the settlement date. The settlement date is subject to change; API users should monitor changes to expTime through the push interface or scheduled query interface.
Second, Leverage. The current leverage supported by OKX pre-market trading is 0.01 ~ 2x, with a maximum of 2x.
Third, Gradation Position Limits. The maximum opening position for users corresponds to the maximum position amount based on the leverage selected in the gradation limit table. The maintenance margin required for the position equals the maintenance margin ratio (MMR) corresponding to the user’s position size in the gradation limit table multiplied by the user’s position size.
**Gradation Position Limit Rules**
| User Level | Maximum Opening Position (USD) | Maintenance Margin Ratio | Initial Margin Ratio | Maximum Leverage |
|————|——————————-|————————-|———————|——————|
| 1 | 5,000 | 10% | 50.00% | 2 |
| 2 | 10,000 | 12% | 50.00% | 2 |
| 3 | 15,000 | 13% | 100.00% | 1 |
| 4 | 20,000 | 14% | 100.00% | 1 |
| 5 | 30,000 | 15% | 100.00% | 1 |
| 6 | 40,000 | 16% | 100.00% | 1 |
| 7 | 50,000 | 17% | 100.00% | 1 |
| 8 | 60,000 | 18% | 100.00% | 1 |
| 9 | 70,000 | 19% | 100.00% | 1 |
| 10 | 80,000 | 20% | 100.00% | 1 |
| 11 | 90,000 | 21% | 100.00% | 1 |
| 12 | 100,000 | 22% | 100.00% | 1 |
Note that the maximum opening position in the above gradation limit table is in USD and needs to be converted into specific contract amounts based on the token price and contract face value:
Contract Amount = USD Value / Token Price / Contract Face Value / Contract Multiplier (specific contract amount values refer to the token listing announcement).
Fourth, Position Limits. For pre-market trading contracts, the size of the position users can open must satisfy both the gradation position limit rules and the user-specific position limit. For USDT-based contract designated market makers (DMM), the position limit is 100,000 USD; for non-USDT-based contract designated market makers (DMM), the position limit is 10,000.
**Position Limit Rules**
| User Type | Position Limit (USD) | Position Limit (Contract Amount) |
|————|———————|———————————-|
| USDT-based Contract DMM User | 100,000 | Contract Amount = USD Value / Token Price / Contract Face Value / Contract Multiplier (specific values refer to the token listing announcement) |
| Non-USDT-based Contract DMM User | 10,000 |
Through OKX pre-market trading, users can fulfill various demands across different dimensions. For example, they can participate in trading before the token is officially launched, strategically positioning themselves to capture market opportunities. Understanding the value expectations of the token before its official launch and participating in pre-market trading activity can enhance community confidence in the token project, validating market demand and project potential through actual transaction data, thus increasing opportunities for price discovery and trading transparency.
Additionally, users can lock in prices before the token’s official launch, using settlement contract trading to hedge against price volatility risks, thereby mitigating uncertainties brought about by market fluctuations. They can also explore more trading strategy options and flexibly adjust their trading portfolios based on market conditions. In summary, through OKX pre-market trading, users can make more proactive and flexible trading decisions in the cryptocurrency market, enjoying more market opportunities and higher trading efficiency.
Despite OKX’s continued efforts to provide a better trading experience, trading pre-market contracts carries high risks as the pre-market environment is more susceptible to reduced liquidity and higher price volatility, and users face greater liquidation risks. Not all tokens traded in pre-market contracts will ultimately be listed on OKX.
Currently, OKX reserves the right to adjust, extend, or terminate the listing of contracts and the contract settlement date at its sole discretion.
It is important to note that pre-market contracts have a fixed expiration date, which is linked to the listing of the relevant underlying token. At expiration, they will only settle in USDT, so users are not trading the underlying token and should not expect to receive the underlying token upon contract expiration. Furthermore, as trading occurs prior to the listing of the relevant tokens, there is no clear identifiable price source for the underlying token, meaning the contract price may differ from the price of the underlying token at and after its listing. OKX may at any time decide to suspend or terminate such pre-market contract trading.
**How to Use OKX Pre-Market Trading?**
Open the OKX App, click on “Trade,” and select “Pre-Market Trading.” Alternatively, click “More” in the upper left corner and select “Pre-Market Trading.”
Using ABCD as an example, after clicking “Go to Trade,” click “Activate Pre-Market Trading” to enter the token trading interface. Pre-market trading is limited to isolated margin mode, allowing users to freely modify the leverage ratio, with a maximum of 2x; other operational processes are similar to most trading processes, allowing users to set order types, prices, costs, and other parameters to open long or short positions based on personal preferences.
From an industry perspective, OKX pre-market trading demonstrates its strong technological innovation and responsiveness to user needs, introducing more trading models and tools to the cryptocurrency market, which can attract more users and liquidity. It also aids in the early discovery and determination of token prices, fostering market consensus before tokens officially launch, thus making market prices more transparent and stable, and promoting industry advancement.
From a user perspective, it allows them to hedge against price volatility risks before the official release of tokens, avoiding potential price fluctuation risks after listing, thereby achieving more effective risk management. Users also gain the opportunity to participate early in new projects, breaking traditional limitations.
From a project perspective, OKX pre-market trading provides new tokens with an additional liquidity channel. Through settlement contracts, traders can conduct buying and selling operations before tokens go live, increasing market activity and liquidity. This is beneficial for new projects, enabling them to garner market attention and financial support even before formal trading. Additionally, new token projects can showcase their market demand and user interest before their official launch, which not only boosts the confidence of project teams but also enhances trust among potential users and communities, aiding in the project’s success post-listing.
However, every tool has dual aspects, and OKX pre-market trading is no exception; while it offers opportunities, it also brings risks, requiring users to conduct comprehensive evaluations before participating, rather than acting blindly. The new coin market is like a brilliant star in the cryptocurrency world, shimmering with infinite possibilities. The launch of OKX’s pre-market trading feature conveys this potential more effectively.
**Disclaimer**
This article is for reference only. It represents the author’s views and does not reflect the position of OKX. It is not intended to provide (i) investment advice or recommendations; (ii) offers or solicitations to buy, sell, or hold digital assets; (iii) financial, accounting, legal, or tax advice. We do not guarantee the accuracy, completeness, or usefulness of the information provided. Holding digital assets (including stablecoins and NFTs) involves high risks and may fluctuate significantly. You should carefully consider whether trading or holding digital assets is suitable for you based on your financial situation. Please consult your legal/tax/investment professionals regarding your specific situation. You are solely responsible for understanding and complying with applicable local laws and regulations.
This content is provided officially and does not reflect the stance or investment advice of this site; readers should conduct prudent evaluations independently.
