USDC Contracts and Options: Transition from USD Index to USDC Index for Pricing

To enhance your trading experience, Bybit will be implementing changes to the index prices of USDC Perpetual Contracts, USDC Futures Contracts, and USDC Options from USD index pricing to USDC index pricing.

The changes will take effect on Sep 26, 2023, 8AM UTC.

Currently, the three (3) products mentioned above are priced in USD while settled in USDC. This has led to certain complexities, despite the 1:1 settlement conversion rate between USDC and USD.

Key Changes

• Index and Mark Prices: The index prices and mark prices will now be quoted in USDC for USDC Perpetual Contracts, USDC Futures Contracts, and USDC Options.
• Order Book Quotations: The order book quotations will also be priced in USDC for the mentioned products.

Please note that the calculation of Initial Margin (IM) and Maintenance Margin (MM) will continue to be calculated in USDC, ensuring consistency in the trading process.

The table below illustrates the changes in pricing unit relations that will take effect after the adjustment:

Example

To showcase the effects of adjusting from USD pricing to USDC pricing, let's consider the following scenario based on certain preconditions:

Current Index Prices

Before the Adjustment:

The index price is still denominated in USD. The user's positions and assets are as follows:

Positions

Assets

After the Adjustment:

Following the transition to a USDC-based price index, assuming prices remain unchanged:

Positions

Assets

Notes:

• The IMR, MMR, and collateral value ratio values provided in the aforementioned scenarios are intended for reference purposes only. The precise IMR and MMR values during the trading process are determined based on the chosen risk tier and leverage.
• Under the Portfolio Margin mode of the Unified Trading Account, the calculation methods for MMR and IMR are not consistent. The formulas used to calculate the IM and MM portions in the above scenarios are not applicable to the Portfolio Margin mode.

Primary Impact Overview

• Adjustment Impact: The change from the USD index to the USDC index has affected the mark price, leading to adjustments in unrealized profit and loss calculations.
• Initial and Maintenance Margin: Initial margin and maintenance margin calculations continue to be denominated and calculated in USDC.
• Settlement Unaffected: Despite adjustments, other settlement aspects remain unchanged, ensuring a consistent transaction process.

Please take note of the following considerations:

• The transition is scheduled for Sep 26, 2023, 8AM UTC. If substantial price fluctuations occur in USDC and the USD-USDC spread falls between 0.2% to 2%, we will execute a seamless transition by migrating from the USD index to the USDC index on an exchange-by-exchange basis.
• If the USD-USDC spread exceeds 2%, it will lead to the suspension of the transition plan. We will choose to migrate when the market is stable and will provide updates via official announcements.
• After this transition, the aforementioned products will be quoted in USDC and will be showcased in the latest version of the Bybit App (4.27.0 and later). However, due to App version constraints, previous iterations of the Bybit App version will persist in displaying denominated in USD, even though the actual quotes will be in USDC.