How we grade venues

What the index is

A grade for each on-chain perpetual futures venue, built from public facts about what happens to your money when things go wrong: a crash, a bad price, an exploit, a frozen bridge. It is not investment advice or an endorsement. A high grade means a venue’s published design and record hold up better than others on these seven questions. It does not mean the venue is safe to use.

Where the facts come from

• The venue’s own documentation, contracts, code, audit reports, terms and status page come first. Independent risk trackers for rollups and reputable reporting are used for incidents and for what venues do not say themselves.
• Every fact carries a source link and a date, and appears on the venue’s page.
• A fact we could only support weakly counts as missing.
• If we checked a venue’s own documentation and the venue does not publish something the method asks for, that item scores as its worst case and is shown as “not disclosed”.
• Incident history is the exception: it is something we observe, so a venue’s silence cannot settle it. If we find no incident after searching, we say so.
• The look-back window for incidents and audits is 24 months.

The seven criteria (100 points)

1. Liquidation and auto-deleveraging (20)

• How profitable positions are chosen for auto-deleveraging is published with the formula: 6. Rules without the formula: 3. Nothing published: 0. A pool-based venue that has no auto-deleveraging by design and documents how its pool pays or caps trader profits: 6.
• Positions can be liquidated in part, not only all at once: 4.
• Auto-deleveraging in the last 24 months: none 6, small (under 1% of open interest) 4, large (over $100M or over 1% of open interest) 0.
• Risky markets are isolated or capped: 4.

2. Insurance fund and who absorbs losses (15)

• The fund or backstop balance can be read on-chain: 5.
• Its size against total open interest: at least 5% 5, 1% to 5% 3, under 1% 1, not disclosed 0.
• The order in which losses are absorbed is published: 5.

3. Price oracle (15)

• Independent sources in the price used for liquidations: three or more 6, two 3, one 1.
• Update interval: 5 seconds or faster 3, up to 60 seconds 2, slower or not disclosed 0.
• Prices are signed by many parties (validators, a multisig, an oracle network): 6. One key or one service: 0.
• An oracle or price-feed failure that cost users money in the last 24 months caps this criterion at 5.

4. Custody and withdrawal (15)

• Users hold their funds in contracts or a chain they withdraw from with their own keys: 4.
• Users can withdraw through a contract-level exit if the operator stops: 4.
• No key, multisig, council or validator set can freeze withdrawals without a delayed governance vote: 3.
• Delay before an upgrade takes effect: 7 days or more 4, at least 1 day 2, less than a day 0.

5. Incidents in the last 24 months (15, points taken off)

• Exploit with user losses not repaid: −10. Exploit fully repaid: −5.
• Outage over 4 hours: −4 each, counted at most twice.
• Price or configuration error that caused liquidations: −5.
• Discretionary intervention: −3. This means the venue or its validators set a settlement price, reversed trades, rolled back state, or froze withdrawals outside an active exploit. Open-interest caps and emergency pauses during an exploit are not interventions.
• The score never goes below 0.

6. Liquidity (10)

• We measure this ourselves: the average price impact of a $100,000 market order in BTC and ETH, buying and selling, from the venue’s live order book or, for pool-based venues, the venue’s own pricing formula. It is compared with the median venue: at or below the median 6, up to twice the median 3, worse 1. A venue that cannot take the order in every measured case gets 1.
• Concentration: liquidity spread across many independent providers 4, partly concentrated 2, one vault, pool or market maker carrying most of it, or not disclosed, 0.

7. Transparency and operations (10)

• Public audits of the core contracts or engine in the last 24 months: two or more 4, one 2, none 0.
• Core contracts or engine code are public: 2.
• A public status page: 2.
• The terms name the operating company: 2.

Grades

A criterion with any fact still missing shows “No data” instead of a score. A venue gets a grade only when at least six of the seven criteria are scored; with one missing, the total is scaled over the criteria we could score.

Corrections

• Anyone, a venue included, can send a correction. It needs a public source we can link to.
• We update the fact, re-run the scoring and note the change in a public log.
• We review every venue at least once a month and within a week of any incident.

Independence

• We never take payment for a grade or for a change to one.
• If we earn fees from trades routed to a venue, we say so on that venue’s page. Fees never enter the scoring.