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Flying Tulip Perps

Perps

Product Overview​

Perpetual futures let you trade with leverage without an expiry date. In most venues, the contract’s price follows an external oracle: a feed that updates every few seconds and decides who is liquidated and who is safe. FT Perps takes a different path. Instead of borrowing prices from somewhere else, it uses its own trading (the AMM and the CLOB) as the source of truth. The contract settles to what actually trades here, not to a delayed print from elsewhere. That single design choice removes a familiar class of oracle lag and manipulation risk, and it changes how everything feels: quotes are live, settlements are sub‑500 ms, and liquidations key off prices you can really hit.

How perpetuals work in crypto: and what breaks​

A perpetual future (or “perp”) is a margin product that mirrors spot exposure with no expiry. Longs and shorts pay each other a funding rate that nudges the perp back toward spot. On most platforms, “spot” is whatever the oracle says. That introduces two problems. First is latency: the oracle ticks every few seconds, so fast markets can move before the feed catches up. Users get liquidated on stale prices, and recovery is messy. Second is surface area: any integration error, governance bottleneck, or upstream hiccup in the oracle can ripple into your position. You pay for that risk in higher costs and fewer listed markets.

FT Perps turns the model inside‑out: it doesn’t ask a third party what the price is. It observes its own order flow. If ETH changes hands at $1,800 on the AMM/CLOB, that is the settlement price. There is nothing to wait for.

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The AMM is the oracle: prices and depth, not just prints​

Pricing begins with the AMM's adaptive curve and the CLOB's resting orders. Together they define where size can actually clear right now. The system looks beyond a single last trade. It maintains a TWAP (time‑weighted average price) for a clean time series and a TWAR‑family of depth‑aware measures that ask a more practical question: how much of X can be sold for Y over this window without punching through reserves? Those depth‑aware windows drive the mechanics that matter: maximum leverage, liquidation sizing, and slippage guards. You are not leveraged against a number that only small trades can hit; you are leveraged against what the pool can truly absorb.

Because price discovery is internal, settlements are near‑instant. There is no 2–5 s oracle tick to wait for, so liquidations are far less likely to trip on lag. And because the same engine sets prices and absorbs liquidations, unwinds can be sized to depth instead of blasted into a vacuum.

Margin and leverage: cross‑collateral when you want it​

Perps can run in isolated or cross‑margin modes. In isolated mode you post collateral for a specific market and keep risk ring‑fenced. In cross‑margin mode (via the permissioned Lend pool) a single deposit backs perps, CLOB orders, and borrowing at once. Your idle margin is not idle: it continues to earn its underlying money‑market yield while it backs trades. Maximum leverage is not a fixed table; it reflects depth and volatility from TWAR windows and contracts when conditions thin. When you open or adjust a position, limits are snapshotted so the rulebook doesn’t change retroactively while you are holding.

Liquidations that respect the market​

When a position needs to be trimmed, the engine simulates the next clip on the AMM’s curve and checks it against guardrails. If the clip would push beyond safe impact, the sale is time‑sliced into smaller steps, often crossing any resting CLOB liquidity first, then walking the AMM. Keepers are rewarded for low‑footprint execution, not for slamming markets. In quiet conditions liquidations resolve in one or two clips; in fragile conditions they step down a staircase. The aim is simple: protect solvency without turning stress into a spiral.

Funding that makes economic sense​

Funding exists to pull the perp back toward spot. FT Perps anchors funding to actual borrowing costs and market imbalances seen in the Lend markets and the AMM/CLOB, not to an external guess. When longs are effectively borrowing dollars to hold coin, and that borrow is expensive, funding reflects it. When shorts crowd the other side, funding flips. You can see the inputs, you can see the update cycle, and you can understand why you paid (or got paid) what you did.

Who takes the other side: opt‑in settlement LPs​

Perps need a counterparty at settlement. FT handles this with opt‑in settlement pools. Liquidity providers deposit ftUSD and volunteer to settle trades in return for per‑settlement fees (around 0.05% per settlement, subject to policy). Exposure is balanced across providers, and providers can adjust or withdraw subject to pool parameters. This design means no one is forced into risk they don't want, and new markets can launch when there is AMM/CLOB liquidity and enough ftUSD settlement supply, not when an oracle committee has time to integrate a feed.

Note on ftUSD
ftUSD is the settlement currency. Holding ftUSD by itself does not pay yield; staking to sftUSD does. Settlement LPs earn perps fees by opting into settlement pools; this is distinct from sftUSD staking yield.

How it fits the rest of Flying Tulip​

Perps sits on top of the same pricing spine as everything else. It references AMM/CLOB windows for price and depth, uses Lend for cross‑margin and portfolio health, and settles in ftUSD. Because Flying Tulip is token‑first, a share of perps revenue participates in the FT buyback pipeline and the revenue‑linked unlocks described in the FT Token overview. The result is a loop: trading activity funds the token economy that, in turn, helps deepen the markets you trade.

What it feels like to trade​

You pick an asset, choose isolated or cross‑margin, and set leverage. The route preview shows the expected impact and your funding context. Orders are matched on the CLOB when you want precision, or crossed against the AMM when you want immediate certainty; most flows use both. Your position updates against live prices (no oracle tick to wait for), and your margin health moves with what actually trades. If the market turns, the liquidation engine trims exposure in measured steps. When conditions are calm, your fills feel like a centralized exchange. When they are not, the system is built to be conservative first and clever second.

Fees and where they go​

Perps charge trading fees and funding transfers between longs and shorts. Settlement LPs earn a per‑settlement fee for providing ftUSD to the settlement pools. A protocol fee may be taken where policy allows; that portion flows into the FT buyback pipeline (and, when revenue‑funded, into the token‑unlock logic). Nothing here promises a fixed rate: fees and funding are variable and transparent, tied to realized activity and risk.

Risks to understand​

Leverage amplifies outcomes. Depth can thin under stress, spreads can widen, and liquidations can still occur. Internal pricing removes a class of oracle risk but not market risk. Smart‑contract and integration risks are inherent to DeFi, and cross‑margining introduces portfolio‑level interactions that you should understand before you size up. The Risks, Security & Audits page explains our controls (guardrails, pausing, caps, monitoring) and what users can do to protect themselves.

How‑to (overview)​

Open a perp position. Choose isolated or cross‑margin, post collateral, set leverage, and place a market or limit order. Review your snapshot limits and funding context before confirming.
Manage margin. Add or remove collateral, reduce size, or close the position. Adjusting re‑snapshots limits under current conditions.
Provide settlement liquidity. Deposit ftUSD into a perps settlement pool to earn per‑settlement fees. Monitor pool parameters (utilization, fee schedule) and adjust or withdraw as policy allows.

FAQs​

Without external oracles, what stops manipulation?
Attackers would need to move actual on‑platform liquidity. Pre‑trade guardrails, depth‑aware windows (TWAR family), dynamic fees, and time‑sliced execution raise the cost of forcing prices where depth doesn’t support it. No system is risk‑free, but the incentives target practical, executable prices.

How fast are settlements, really?
Settlements are sub‑second (targeting sub‑500 ms) because prices come from our own AMM/CLOB. There is no oracle tick to wait for.

What determines my maximum leverage?
Depth and volatility. The engine reads TWAR/TWAP windows and sets leverage so your position is sized against what the market can absorb. As conditions change, new opens/adjustments get new snapshots.

Do settlement LPs take directional risk?
They provide ftUSD to settle trades and earn per‑settlement fees. Exposure is diversified across providers and managed by pool policy. LPs can adjust or withdraw subject to parameters.

Does ftUSD pay yield by itself?
No. ftUSD is the settlement currency and is non‑yielding by default. If you want yield, stake ftUSD to sftUSD. Settlement LP fees are a separate earnings path tied to perps activity.

What happens in thin markets?
Leverage limits contract, fees can rise, and the liquidation engine relies more heavily on slicing and routing through any resting CLOB liquidity. In extreme conditions, circuit breakers and policy caps apply.

  • FT AMM: Product Overview: the adaptive curve, TWAP/RWAP, and routing with the CLOB
  • FT Lend: Product Overview: cross‑margin collateral, snapshot LTV, and soft liquidations
  • ftUSD: Product Overview: settlement currency and the distinction between ftUSD and sftUSD
  • FT Token: Product Overview: token‑first revenue flows and buyback pipeline
  • Risks, Security & Audits: platform‑wide risks and controls
  • How‑to Guides: Open/Close a Perp, Manage Margin, Provide Settlement Liquidity (coming soon)