Prelaunch Markets

Prelaunch markets (also called pre-listing perpetuals) allow trading on tokens before they list on major exchanges. These markets use conservative oracle and funding mechanics to operate safely in the absence of reliable external price feeds.

Oracle Design

Standard perpetual markets use a weighted median of 8 centralized exchange prices. Since prelaunch assets are not yet listed on these exchanges, a specialized oracle is used instead.

8-Hour EMA Oracle

The prelaunch oracle computes an 8-hour Exponential Moving Average (EMA) from minutely mark price samples:

EMA Formula

alpha = 2 / (N + 1)    where N = 480
EMA_i = alpha * price_i + (1 - alpha) * EMA_{i-1}

The EMA is seeded with the first available sample and updated with each new minutely observation. Using integer fixed-point arithmetic with 1,000,000x precision ensures deterministic computation across all validators.

Price Caps

To prevent manipulation in thin prelaunch markets, two price caps are enforced:

Oracle Price Cap (4x)

The oracle price is capped at 4x the initial listing price:

capped_oracle = min(ema_price, initial_price * 4)

This prevents the oracle from reflecting extreme speculative prices that could distort margin calculations and funding rates.

Mark Price Cap (3x EMA)

The mark price used for margin and liquidation is capped at 3x the current EMA:

capped_mark = min(raw_mark_price, ema_price * 3)

This prevents sudden spikes in the order book from triggering inappropriate liquidations.

Reduced Funding

Prelaunch markets use 1% of the standard funding rate to minimize the impact of funding in the absence of a reliable spot reference:

prelaunch_funding = standard_rate * 100 / 10,000

At the standard base rate of 0.01% per 8 hours, the prelaunch funding rate is 0.0001% per 8 hours — effectively negligible.

Conversion to Vanilla

When the underlying token lists on a major centralized exchange with sufficient liquidity:

1. The prelaunch market is flagged for conversion
2. No further EMA samples are accepted
3. The oracle switches to the standard weighted median system
4. Margin tiers and funding parameters revert to standard values
5. The conversion is irreversible

After conversion, the market operates identically to any other perpetual contract on GX Exchange.

Lifecycle

Create prelaunch market (initial_price, asset)
    |
    v
Active phase:
  - Minutely mark price samples collected
  - 8h EMA oracle computed
  - 4x oracle cap, 3x mark cap enforced
  - 1% funding rate applied
    |
    v
Token lists on major exchange
    |
    v
Convert to vanilla perpetual
  - Standard oracle (weighted median of 8 exchanges)
  - Standard funding rate
  - Standard margin tiers

Restrictions

• Prelaunch markets cannot be queried for oracle prices after conversion
• No new samples can be added after conversion
• Attempting to create a prelaunch market for an asset that already exists returns an error
• Initial price must be strictly greater than zero

Risk Considerations

Prelaunch markets carry higher risk than standard markets:

• Lower liquidity may result in wider spreads and higher slippage
• The EMA oracle may lag significant price movements
• Price caps may prevent traders from exiting at fair value during extreme moves
• Reduced funding rate means the perpetual price may deviate further from the eventual spot price