Technical Explanations
Delisting Process
2min
Delisting a perpetuals market can occur in a tail risk event, but the protocol has an on-chain procedure in place similar to the expiry of any derivatives contract (futures, options).
The process is as follows:
- The market immediately enters "reduce only mode" once an expiry date is set
- all new orders are forced to have reduce only flag
- all current orders that will increase risk will get cancelled on fill attempts
- no new funding rate updates
- users cannot settle unrealized P&L prior to expiry
- After the expiry date, the market can lock in a settlement price
- must call the instruction: settle_expired_market
- the target price is the amm's calculated 1-hour oracle twap but is altered such that it allows for full solvency across all users
- After the expiry date + optional time buffer, users can settle their "expired positions" at the settlement price, which are closed
- the optional time buffer is the settlement duration, which acts as a buffer for liquidations
- any necessary insurance fund draws and/or social loss can occur
- at position closure, the taker fee is applied (so as to encourage close during reduce only mode)
- Once the number of users in the market reaches zero, the remaining balance PnL Pool can be settled into the quote asset's Revenue Pool
- The market immediately enters "reduce only mode" once an expiry date is set
- this blocks new borrows, new deposits, and new buys in the market
- After the expiry date, the market is set into "force close mode" [TODO]
- deposits are sent back to the user's associated token address up to an amount that still satisfies their margin requirement
- opens the possibility for liquidation of borrows and/or swaps of deposits to other accepted collateral
Updated 21 Feb 2023
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