SCCP-2014: Update Perp Parameters

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Simple Summary

This SCCP proposes to update the perp-v2 parameters as per the below configurations:

Max Market Value

Existing Proposed
sCRV 727,000 2,000,000
sBLUR 1,750,000 3,000,000

Skew Scale

Existing Proposed
sSOL 10,000,000 6,000,000
sDOT 30,000,000 20,000,000
sAVAX 8,000,000 5,000,000

Liquidation Buffer Ratio and Liquidation Premium Multiplier

Keep the liquidation buffer ratio and liquidation premium multiplier at their current levels, specified below:

liquidationBufferRatio liquidationPremiumMultiplier
sETH 75 1.5625
sBTC 75 1.5625
BNB 100 1.5625
LINK 100 1.5625
SOL 100 1.5625
MATIC 100 1.5625
DOGE 100 1.5625
FTM 121 1.5625
ATOM 121 1.5625
AVAX 121 1.5625
ARB 121 1.5625
OP 121 1.5625
APE 121 1.5625
NEAR 121 1.5625
AXS 121 1.5625
UNI 121 1.5625
DYDX 121 1.5625
AAVE 121 1.5625
FLOW 121 1.5625


Below is a description on the parameters being updated:

  • maxMarketValue is the maximum amount of open interest allowed on long and short positions in a given perp market.
  • skewScale is a scaling parameter that helps calibrate the amount of slippage (or price improvement) a position receives when a position is modified. It also is a parameter that affects the speed by which funding rate changes.
  • liquidationBufferRatio is the penalty imposed on a position when it is liquidated. The penalty is calculated as follows: buffer * P * S
  • LiquidationPremiumMultiplier or LPM is an additional margin required to be set aside when an account opens position with larger size. The liquidationPremium is calculated as follows: LPM * (S /Scale) * P * S .


The primary motivation behind these parameter changes:

  • maxMarketValue is proposed to increase in order to cater for rising demand. It is worth noting that the risk associated with this change is considered low taking into account the OI available on centralized exchanges vis-a-vis the potential increase in synthetix oi capacity.
  • Skew Scale is updated on few markets in order to align with the scaling factor derivative seen on centralized exchanges.
  • Liquidation Buffer Ratio and Liquidation Premium Multiplier are kept at the current levels, overriding the changes that are yet to affected mentioned in SCCP-293. The motivation behind this is that newly imposed leverage restrictions at the UI level, help constrain the risk on the debt pool all the while improving the UX on traders with respect to limiting imminent liquidations.


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