Open Interest Position Limit Mechanism

[Estimated reading time: 3 minutes]

To limit the impact of any single account on the market and protect your execution quality, we set rules on the position size you can hold. These rules work across two dimensions: Open Interest (OI) position limits and leverage tiers.

 

1. OI position limits

1. Position limits apply both per user ID (UID) and per user. A user means a main account together with its sub-accounts.The specific rules are as follows:

• Openable position per UID = min(max(UID absolute position limit, current one-sided market OI of the trading pair × UID position limit percentage), openable position per user – sum(current open positions across all main accounts and sub-accounts))

• Openable position per user = max(user absolute position limit, current one-sided market OI of the trading pair × user position limit percentage)

• Once you reach the OI position limit, you can only reduce positions.

2. For detailed parameters, see, OI position limits.

3. In addition to UID-level limits, we may enable a platform-wide OI position limit when necessary to keep risk under control. Once it’s enabled and the platform’s one-sided OI reaches the corresponding threshold, you can only reduce positions and can’t add to them.

 

Examples:

a. For a single UID, the account holds a long position of 10,000 USDT, long orders totaling 6000 USDT, and short orders totaling 3000 USDT. The per-UID futures position notional value threshold is 15,000 USDT, the per-UID futures position percentage threshold is 10%, and the platform-wide OI is 200,000 USDT. The UID’s long position size is 10,000 USDT + 6000 USDT = 16,000 USDT, which is greater than max(15,000 USDT, 200,000 USDT × 0.5 × 10%). This triggers the OI position limit for long positions.

b. For a single user, the main account has a long position of 18,000 USDT, and the user has one sub-account with a long position of 15,000 USDT. The futures position notional value threshold for the main account and its sub-account is 30,000 USDT, the futures position percentage threshold is 20%, and the platform-wide OI on both sides is 200,000 USDT. The user’s long position size is 18,000 USDT + 15,000 USDT = 33,000 USDT, which is greater than max(30,000 USDT, 200,000 USDT × 0.5 × 20%). This triggers the user’s OI position limit.

 

2. Leverage tiers

Each futures contract has tiered position limits (risk limit).The larger the position size, the higher the position tier and the stricter the corresponding requirements:

Position size	Position tier	Maintenance margin rate	Maximum available leverage
Small	Low	Low	High
Increases by tier	Rises by tier	Rises by tier	Decreases by tier
Large	High	High	Low

In other words, a larger position puts you in a higher tier, which requires more maintenance margin and allows less leverage.This ensures that large positions are better able to absorb risk.For detailed parameters, see the position tier overview.

 

What happens when you exceed the limit and what to do:

• If opening or adding to a position would push it past the upper limit of the highest tier allowed for the contract, the request will be rejected.

• To hold a larger position, first lower your leverage to move into a higher tier (and add enough margin to meet that tier’s requirements), then continue adding to your position.

• During the tiered position reduction stage of liquidation, the system will also reduce your position one tier at a time until the risk level falls.