Holding Trades

Traders can add collateral and update TP/SL while their trade is open. Compounding fees charged vary as a function of current asset volatility and Open Interest Imbalance.

Dynamic User interactions

Users can update certain aspects of their open trades:

Update Take Profit: Traders can update the value of or add a Take Profit order.
Update Stop Loss: Traders can update the value of or add a Stop Loss order.
Add Collateral: Traders can top up collateral on their position to reduce leverage and minimize liquidation risk.
Remove Collateral: Traders can withdraw collateral on their position; however, the liquidation risk increases.

In all cases, no additional fee is charged by the protocol because no price is requested.

Monitoring of Trade State

Ostium uses Gelato Functions to continuously track price changes and determine the need for automated order execution (liquidations, stop losses, take profit orders).
Trade state simulation runs frequenlty, radically minimizing the risk of would-be liquidations or other automated orders from being executed outside of an acceptable time frame or of bad debt accruing for the liquidity buffer.

Compounding Fees

Ostium applies compounding fees to open positions to reflect the evolving market dynamics and the cost of holding positions over time. These fees accrue continuously and are factored into the trader’s unrealized PnL. There are two distinct types, depending on the asset class:

Funding Fee (Crypto Pairs): Applied to positions on cryptocurrency pairs, this fee captures the open interest (OI) imbalance between long and short positions — similar to traditional perpetual exchanges. It serves to:
- Incentivize traders to rebalance OI skew
- Minimize delta exposure for the Liquidity Buffer
- Create a zero-sum transfer between the "popular" and "unpopular" side of the market
Rollover Fee (Non-Crypto Pairs): Applied to positions on non-crypto assets like forex, commodities, and indices, this fee reflects the underlying market's holding cost, such as interest rates, storage, or carry costs. It ensures pricing on Ostium stays consistent with the real-world cost of maintaining similar positions in traditional markets.

Both fees are synthetically applied to the entire position size, compounding per block, and are realized upon closing a position.

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Last updated 18 days ago

Dynamic User interactions

Users can update certain aspects of their open trades:

Update Take Profit: Traders can update the value of or add a Take Profit order.

Update Stop Loss: Traders can update the value of or add a Stop Loss order.

Add Collateral: Traders can top up collateral on their position to reduce leverage and minimize liquidation risk.

Remove Collateral: Traders can withdraw collateral on their position; however, the liquidation risk increases.

In all cases, no additional fee is charged by the protocol because no price is requested.

Monitoring of Trade State

Ostium uses Gelato Functions to continuously track price changes and determine the need for automated order execution (liquidations, stop losses, take profit orders).

Trade state simulation runs frequenlty, radically minimizing the risk of would-be liquidations or other automated orders from being executed outside of an acceptable time frame or of bad debt accruing for the liquidity buffer.

Compounding Fees

Funding Fee (Crypto Pairs): Applied to positions on cryptocurrency pairs, this fee captures the open interest (OI) imbalance between long and short positions — similar to traditional perpetual exchanges. It serves to:

Incentivize traders to rebalance OI skew
Minimize delta exposure for the Liquidity Buffer
Create a zero-sum transfer between the "popular" and "unpopular" side of the market

Rollover Fee (Non-Crypto Pairs): Applied to positions on non-crypto assets like forex, commodities, and indices, this fee reflects the underlying market's holding cost, such as interest rates, storage, or carry costs. It ensures pricing on Ostium stays consistent with the real-world cost of maintaining similar positions in traditional markets.

Both fees are synthetically applied to the entire position size, compounding per block, and are realized upon closing a position.