Binance Futures announces the launch of a new perpetual contract for Floki Inu
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The meme coin hype appears to be back, given the recent gains made by meme coins such as PEPE and FLOKI. One of the reasons behind the recent surge in FLOKI’s price is the launch of a new perpetual contract for FLOKI by Binance Futures.
Binance Futures launches a new perpetual contract for Floki Inu
Floki Inu is among the dog-themed meme cryptocurrencies in the market. The Shiba Inu dog breed inspires the meme coin. FLOKI is a competitor of some of the top meme coins in the industry, such as Dogecoin and Shiba Inu.
The perpetual contract in question provides up to 20x leverage. Binance Futures launched the new offering at 4:30 PM UTC on May 6. The launch adds more legitimacy to the meme cryptocurrency, whose popularity and market value have increased significantly.
Perpetual contracts are a form of derivative offering. This product allows traders to purchase or sell the underlying asset without expiration. Binance Futures will allow traders to trade FLOKI as a derivative product in this case.
Perpetual contracts usually track the spot price of the underlying asset. The contracts support long and short positions while also enabling leverage. The funding rates are periodically exchanged between the long and short positions in intervals of eight hours. The reason behind the periodic change in funding rates is to ensure that the price of the perpetual remains in line with the asset’s actual value despite the lack of an expiration date.
FLOKI perpetual contract size
The FLOKI perpetual contract being offered by Binance is a 1000 FLOKI/USDT contract. The contract is based on the value of 1,000 FLOKI tokens and is settled using USDT. Tether (USDT) I a stablecoin whose value is pegged to the US dollar.
The contract has a tick size of 0.00001, featuring a capped funding rate, and can be traded around the clock. Binance has already integrated a multi-assets model where users can trade the perpetual contract across different margin assets. The traders can trade the asset subject to some rules.
The nature of this product means that crypto traders can use crypto assets such as BTC as margin when they trade 1000 FLOKI/USDT perpetual contract. This makes the product more accessible to crypto traders.
Floki, which is one of the largest crypto projects in the market, has also said that depending on the risk conditions in the market, it might adjust the requirements of the 1000 FLOKI/USDT perpetual contract with time. Some of the changes that could be introduced in the future include the tick size, maximum leverage, initial margin and the requirements for margin maintenance.
FLOKI has performed quite well over the past week, given that it has gained by over 10% during this time. At the time of writing, FLOKI was trading at $0.0000376 according to data from CoinGecko. However, it has dropped by 3.3% in the last 24 hours.
