The EOS.IO software introduces a new blockchain architecture designed to enable vertical and horizontal scaling of decentralized applications. This is achieved by creating an operating system-like construct upon which applications can be built. The software provides accounts, authentication, databases, asynchronous communication and the scheduling of applications across hundreds of CPU cores or clusters. The resulting technology is a blockchain architecture that scales to millions of transactions per second, eliminates user fees, and allows for quick and easy deployment of decentralized applications.
The EOS crowdsale is slated to begin on 26 June 2017.
On BitMEX, the EOS derivative is in the form of a Futures Contract and allows traders to speculate on the future value of the EOS Token / Bitcoin (EOS/XBT) exchange rate. Traders need not have EOS Tokens to trade the futures contract as it only requires Bitcoin as margin.
The EOS futures’ underlying is the EOS/XBT exchange rate on Bittrex, Kraken, or Poloniex as recorded in the .EOSXBT Index. The futures are quoted in Bitcoin and all margin and PNL calculations are denominated in Bitcoin.
|XBT Contract Value||Multiplier * Futures Price * 1 EOS|
|USD Contract Value||XBT Contract Value * XBTUSD|
|PnL Calculation||# Contracts * Multiplier * (Exit Price - Entry Price)|
Traders who think that the price of EOS will rise will buy the futures contract. Conversely, traders who believe the price will drop will sell the futures contract.
All margin is posted in Bitcoin, that means traders can go long or short this contract using only Bitcoin. The EOS futures contracts feature a leverage of up to 2x.
For example, to buy 10 Bitcoin worth of contracts, you will only require 5 Bitcoin of Initial Margin.
The EOS platform is still under development. It is expected that EOS tokens will be available for trading in the secondary market by the expiry date of EOSN17, 28 July 2017 12:00 UTC.
If no EOS token auction has been completed before the expiry date, EOSN17’s settlement price will be 0.
If an EOS token auction has been completed but EOS/XBT trading has not begun on either Bittrex, Kraken, or Poloniex by 27 July 2017 12:00 UTC, EOSN17’s settlement price will then be the most recent auction’s clearing price at settlement.
If EOS/XBT trading begins on or before 27 July 2017 12:00 UTC, BitMEX will announce the reference exchange prior to settlement. The EOS futures contracts will then settle on the .EOSXBT30M Index Price.
As per the Settlement guide above, if trading has not begun on the aforementioned exchanges by the proposed date then the settlement price of EOSN17 will default to the most recent auction’s clearing price at settlement. Please read “7. How does the EOS Token distribution work?” for further information about the EOS auction process.
The settlement price of the contract under this scenario will be the following:
EOS/ETH Auction Clearing Price * .ETHXBT
EOS futures may only move 25% above (Limit Up) or below (Limit Down) the previous session close. Each session is 2 hours in length, resetting on every even hour UTC time. Buy or sell orders may not be placed above or below the Limit Up or Down price respectively. The Limit Up and Down percentage will be removed shortly before or after EOS lists on a secondary spot market. Advance notice will be given before the limits are removed, and EOS futures are allowed to trade freely.
A trader wants to goes long 10 XBT of EOS futures contracts. EOSN17 (the monthly EOS futures contract) trades at 0.0200 XBT. As the leverage is 2x, the trader only needs 5 XBT of margin for this trade.
The trader must buy 500 contracts: 10 XBT / (0.0200 XBT * 1).
A few days later, the price rises to 0.0250 XBT and the trader sells all their contracts.
The trader’s profit will be: 500 * 1 * (0.0250 - 0.0200) = 2.5 XBT