Crypto futures glossary: funding, margin and liquidation terms
This crypto futures glossary defines the terms used on Flipster contract pages and in its guides, from mark price and funding cap to maintenance margin and auto-deleveraging, each in one sentence followed by an example taken from a live Flipster contract specification or from the published terms.
For information only. Not investment advice.
| Entries | 29 terms in six groups |
|---|---|
| Each entry | One-sentence definition, then a Flipster example with its source |
| Contract examples | BTCUSDT.PERP and XAUUSDT.PERP |
| Terms and guides | Derivatives Trading Terms, margin guide, fee guide, Proof of Reserves page |
| Longer guides | Funding rate, liquidation price, proof of reserves |
Prices
Three prices appear on every contract page. Only one of them, the mark price, decides when a position is liquidated.
Index price
The index price is a reference price for the underlying asset, calculated as an average of prices on several major exchanges.
The BTC index behind BTCUSDT.PERP has eight constituents: Binance, Bitget, Bybit, Coinbase Pro, Gate.io, KuCoin, MEXC and OKX. Flipster describes the index price as an average of prices from major exchanges, updated per second. The gold index behind XAUUSDT.PERP has one constituent, Binance XAUUSDT (BTCUSDT.PERP and XAUUSDT.PERP sheets under flipster.io/support/trading-rules/contract/, read 2026-10-11).
Mark price
The mark price is the venue’s calculated fair value of a contract; it, not the last traded price, decides when a position is liquidated.
Flipster’s Derivatives Trading Terms define the mark price as the fair market value of the perpetual contract as calculated by Flipster, and BTCUSDT.PERP and XAUUSDT.PERP both list the mark method as fair price. The formula is not given on the pages read for this glossary (flipster.io/policies/derivatives, read 2026-10-11).
Last price
The last price is the price of the most recent trade in a contract on one venue.
The last price moves with every trade, but it is not Flipster’s liquidation trigger: under the Derivatives Trading Terms a position is closed when the mark price hits the liquidation price. The BTC index, in turn, is built from prices on eight other exchanges (flipster.io/policies/derivatives, read 2026-10-11).
Tick size and lot size
Tick size is the smallest price step in which a contract is quoted; lot size is the smallest quantity step of an order.
BTCUSDT.PERP is quoted in steps of 0.1 USDT and traded in lots of 0.000001 BTC. XAUUSDT.PERP uses 0.01 USDT and 0.00001 XAU. The smallest order on both contracts is 1 USDT of notional value (BTCUSDT.PERP and XAUUSDT.PERP sheets under flipster.io/support/trading-rules/contract/, read 2026-10-11).
Funding
Funding is a payment between traders at fixed times. Each contract sheet publishes its interval, its cap and its base rate.
Funding rate
The funding rate is the periodic payment rate between long and short holders of a perpetual contract; when it is positive, longs pay shorts.
Flipster’s guide says that funding applies only to positions held at the funding timestamp, that shorts pay longs when the rate is negative, and that traders exchange funding with each other with no additional cost levied by the platform (flipster.io/support/guide/perpetual-swaps, read 2026-10-11).
Funding interval
The funding interval is the fixed time between two funding payments on a contract.
BTCUSDT.PERP exchanges funding every 8 hours, at 00:00, 08:00 and 16:00 UTC. XAUUSDT.PERP does so every 4 hours from 00:00 UTC, which makes six funding times a day. A position closed before a funding time neither pays nor receives that payment (BTCUSDT.PERP and XAUUSDT.PERP sheets under flipster.io/support/trading-rules/contract/, read 2026-10-11).
Funding cap
The funding cap is the highest funding rate a contract can apply at a single funding time.
The cap is 0.3000% on BTCUSDT.PERP and 0.5000% on XAUUSDT.PERP. On a position with a notional value of 10,000 USDT, one payment at the cap would be 30 USDT on the bitcoin contract and 50 USDT on the gold contract (BTCUSDT.PERP and XAUUSDT.PERP sheets under flipster.io/support/trading-rules/contract/, read 2026-10-11).
Base interest rate
The base interest rate is the fixed component of a funding rate, set per contract; the premium is the variable component.
Flipster quotes it per 8 hours: 0.01% on BTCUSDT.PERP and 0.00% on XAUUSDT.PERP. The contract sheets do not show how the base rate and the premium are combined into the funding rate (BTCUSDT.PERP and XAUUSDT.PERP sheets under flipster.io/support/trading-rules/contract/, read 2026-10-11).
Margin and leverage
Margin is the collateral behind a leveraged position. The margin mode decides which collateral a liquidation can reach.
Initial margin
Initial margin is the collateral placed to open a leveraged position.
In Flipster’s single-asset mode only USDT and Trading Bonus can be used as initial margin; cross-asset mode accepts a list of marginable assets. Under clause 4.1.3 of the Derivatives Trading Terms, Flipster may amend the maximum leverage and the initial and maintenance margin requirements from time to time (flipster.io/support/guide/margin-trading, read 2026-10-11; flipster.io/policies/derivatives, read 2026-10-11).
Maintenance margin
Maintenance margin is the minimum collateral needed to keep a leveraged position open.
When collateral falls below the maintenance margin, a Flipster position becomes subject to liquidation, and the liquidation fee is half of that maintenance margin. The rate for each contract is not on the pages read for this glossary (flipster.io/support/guide/margin-trading, read 2026-10-11).
Isolated margin
Isolated margin assigns a set amount of margin to one position, separate from the rest of the account.
Flipster’s margin guide describes isolated margin as margin allocated per position, so the liquidation of that position depends on its own allocation, not on the whole balance. The Derivatives Trading Terms still warn that losses can exceed the amount you deposited (flipster.io/support/guide/margin-trading, read 2026-10-11).
Cross margin
Cross margin shares one pool of margin across every cross position in the account.
Under Flipster’s margin guide, margin is shared between cross positions and a liquidation may affect all of them, so a loss on one position reduces the margin behind the others. The guide allows up to 50 positions and/or pending orders per symbol (flipster.io/support/guide/margin-trading, read 2026-10-11).
Leverage
Leverage is the notional value of a position divided by the margin that supports it.
A position of 5,000 USDT on 1,000 USDT of margin is leveraged 5-to-1. In Dubai, where Flipster FZE holds VARA VASP Licence VL/26/07/002 for Exchange Services, the regulator’s Exchange Services Rulebook does not let Retail Investors use exchange-traded derivatives with more than 5-to-1 leverage, because the minimum initial margin is 20% (VARA rulebook section on margin and leverage limits, opened 2026-10-11). That licence is not stated to cover perpetual futures.
Notional value
Notional value is the full size of a position: the contract quantity multiplied by the price.
One BTCUSDT.PERP contract is worth 1 BTC, so 0.05 BTC at an illustrative price of 100,000 USDT has a notional value of 5,000 USDT. Flipster accepts BTCUSDT.PERP orders from 1 USDT to 3,000,000 USDT of notional value and caps a position at 3,000,000 USDT (flipster.io/support/trading-rules/contract/BTCUSDT.PERP, read 2026-10-11).
Liquidation
Liquidation on Flipster is automatic and comes without notice. These six terms follow the sequence from the trigger to the backstop.
Liquidation price
The liquidation price is the mark price at which the venue closes a leveraged position because its margin has fallen to the maintenance level.
Under Flipster’s Derivatives Trading Terms, a position is closed automatically, without prior notice, when the mark price hits its liquidation price. The service runs 24 hours a day, 7 days a week, so margin calls and liquidations can occur at any time (clauses 4.1.5 to 4.1.8 and 4.2, flipster.io/policies/derivatives, read 2026-10-11).
Bankruptcy price
The bankruptcy price is the price at which a position’s losses equal all of the margin behind it.
Flipster’s margin guide uses it as the dividing line after a liquidation. If the position is closed at a better price than the bankruptcy price, the remaining margin goes to the Insurance Fund; if it is closed at a worse price, the Insurance Fund covers the shortfall (flipster.io/support/guide/margin-trading, read 2026-10-11).
Liquidation fee
A liquidation fee is a charge taken from a position’s margin when the venue liquidates it.
Flipster charges a liquidation fee equal to half of the maintenance margin of the liquidated position. Margin that remains above the fee goes to the Insurance Fund (Derivatives Trading Terms, clauses 4.1.5 to 4.1.8, flipster.io/policies/derivatives, read 2026-10-11).
Insurance fund
An insurance fund is a pool a venue keeps to cover losses when a liquidated position closes beyond its bankruptcy price.
On Flipster the Insurance Fund receives the margin left over from liquidations and covers shortfalls. Its balance is not published on the pages read for this glossary, so it cannot be compared with open interest here (flipster.io/support/guide/margin-trading, read 2026-10-11).
Auto-deleveraging
Auto-deleveraging (ADL) closes profitable positions on the opposite side when the insurance fund cannot absorb a liquidated position.
Flipster’s Derivatives Trading Terms call it counterparty liquidation: if the Insurance Fund cannot absorb a position, a profitable position can be closed. BTCUSDT.PERP and XAUUSDT.PERP both list auto-deleveraging as enabled. The order in which counterparties are chosen is not on the pages read (flipster.io/policies/derivatives, read 2026-10-11).
Backstop liquidity provider
A backstop liquidity provider is a party that takes over and unwinds positions a venue has liquidated.
Flipster’s margin guide says a Backstop Liquidity Provider unwinds a position once it is subject to liquidation. The guide does not name the provider or say how it is related to Flipster (flipster.io/support/guide/margin-trading, read 2026-10-11).
Orders, fees and market data
These terms describe how an order is priced and the limits a venue places on a market.
Maker and taker
A maker places an order that waits in the order book; a taker trades against an order already there, usually at a higher fee.
At VIP0, Flipster’s entry tier, the maker fee is 0.02% (futures only) and the taker fee is 0.06% (spot and futures). On an order of 1,000 USDT that is 0.20 USDT as a maker or 0.60 USDT as a taker (flipster.io/support/guide/fees, read 2026-10-11).
Open interest
Open interest is the total size of all contracts in a market that are open and not yet closed.
Venues can cap it. Flipster’s contract sheets list a maximum open interest of 480,000,000 USDT on BTCUSDT.PERP and 30,000,000 USDT on XAUUSDT.PERP. The same sheets set a separate maximum for a single position: 3,000,000 USDT on BTCUSDT.PERP and 2,000,000 USDT on XAUUSDT.PERP (BTCUSDT.PERP and XAUUSDT.PERP sheets under flipster.io/support/trading-rules/contract/, read 2026-10-11).
Slippage
Slippage is the difference between the price expected when an order is sent and the price at which it is filled.
Flipster’s contract sheets set a maximum slippage of 0.80% on BTCUSDT.PERP and 3.00% on XAUUSDT.PERP. Slippage is also one of the reasons the Copy Trading Specific Terms give for a copier’s results differing from the Master Trader’s, next to balance, leverage, trade size, timing and fees (BTCUSDT.PERP and XAUUSDT.PERP sheets under flipster.io/support/trading-rules/contract/, read 2026-10-11; flipster.io/policies/copy-trading-specific-terms, read 2026-10-11).
Perpetual futures
Perpetual futures, also called perpetual swaps, are futures contracts without an expiry date.
Flipster’s perpetuals are quoted and settled in USDT: one BTCUSDT.PERP contract is worth 1 BTC and one XAUUSDT.PERP contract is worth 1 XAU. With no expiry to pull the contract back to the underlying price, funding payments at fixed intervals do that job (flipster.io/support/guide/perpetual-swaps, read 2026-10-11).
perpetual futures contract specification · gold perpetual contract specification
Custody and assurance
These terms describe how an exchange holds client assets and how it shows that it holds them.
Proof of reserves
Proof of reserves is a published check that an exchange holds assets at least equal to its customers’ balances.
Flipster’s Proof of Reserves page shows a Merkle root hash and, for each asset, customer net balances against Flipster net balances. It names no auditor, so the figures are the company’s own (flipster.io/support/proof-of-reserves, read 2026-10-11).
Merkle tree
A Merkle tree is a structure of hashes that condenses many records into one root hash against which any single record can be checked.
Flipster states that each user’s balance is a hashed value inside a Merkle tree and that users can verify their inclusion without revealing personal details. Inclusion shows that a balance was counted among the liabilities; it does not by itself show that the matching assets exist (flipster.io/support/proof-of-reserves, read 2026-10-11).
Cold wallet
A cold wallet keeps the private keys of crypto assets offline, away from internet-connected systems.
Flipster FZE, the Dubai company, states that it keeps at least 90% of client virtual assets in a cold wallet and less than 10% in a hot wallet. The statement covers Flipster FZE; no such split is published for Flipster Corp (flipster.io/policies/public-disclosure-uae, read 2026-10-11).
Multi-party computation (MPC)
Multi-party computation (MPC) splits a private key into shares held by separate parties, so that no single party can sign a transaction alone.
Flipster describes its custody as MPC cold-wallet custody with Fireblocks. This is a company statement, read on the Flipster blog on 2026-10-06; the scope of the arrangement is not published (flipster.io/blog/a-complete-guide-to-tradfi-perpetuals-on-flipster).
Ask a question
If a term on a contract page is not defined here, the Flipster FAQ answers account, availability and product questions. For a question about your own account, contact Flipster support.
Read the longer guides
The Flipster Learn hub holds the three guides these entries point to. The funding rate and liquidation price guides work through the formulas with examples, and the proof of reserves guide shows how to check a published report.
Before you trade
The definitions are general explanations. The binding wording is in Flipster’s published terms and contract specifications, which can change. This glossary is for information only and is not investment advice. Read the risk disclosure first, or go back to the Flipster home page.
| Document | Where | Read |
|---|---|---|
| BTCUSDT.PERP contract specification | flipster.io/support/trading-rules/contract/BTCUSDT.PERP | 2026-10-11 |
| XAUUSDT.PERP contract specification | flipster.io/support/trading-rules/contract/XAUUSDT.PERP | 2026-10-11 |
| Perpetual swaps guide | flipster.io/support/guide/perpetual-swaps | 2026-10-11 |
| Margin trading guide | flipster.io/support/guide/margin-trading | 2026-10-11 |
| Fee guide | flipster.io/support/guide/fees | 2026-10-11 |
| Derivatives Trading Terms, last updated 13 February 2026 | flipster.io/policies/derivatives | 2026-10-11 |
| Copy Trading Specific Terms, last updated 26 February 2026 | flipster.io/policies/copy-trading-specific-terms | 2026-10-11 |
| Proof of Reserves page | flipster.io/support/proof-of-reserves | 2026-10-11 |
| Public Disclosure (UAE), last updated 18 June 2026 | flipster.io/policies/public-disclosure-uae | 2026-10-11 |
| VARA Exchange Services Rulebook, Part V, section G (regulator of Flipster FZE, licence VL/26/07/002) | rulebooks.vara.ae, margin and leverage limits | 2026-10-11 |
Next: how funding is set and what it costs to hold a position