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The mechanisms on this page describe perpetual pricing. Spot markets execute at order-book prices and are not subject to mark price or discovery bounds. Spot orders are checked against the oracle price for the underlying before they enter the book. See Markets for spot trading hours.

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Oracle Price

The oracle price serves two critical functions:
  • As the reference price for funding rate calculations.
  • As a direct input to the mark price calculation.
Ondo Perps lists perpetuals on real-world assets whose underlying markets close on weekends and holidays. The exchange operates 24/7, but external price feeds go dark from Friday’s equity close to Sunday evening (U.S. ET). To maintain continuous pricing, the system prioritizes external pricing when available and switches to an internal mechanism when it is not.

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External Pricing

During regular market hours, the oracle price is derived from external price feeds (Pyth, Stork, and other institutional data providers) that consume live market data for the underlying assets. The externally-derived fair price is used directly as the oracle price. When external markets close at 4:00 PM ET on Friday, these feeds effectively freeze. The last traded price is broadcast on repeat, but no genuine price discovery occurs through external feeds until markets reopen.

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Internal Pricing

When external pricing becomes unavailable, the oracle switches to an internal pricing session that derives a continuously updating price from on-platform order book activity. The internal oracle initializes from the last available external price at Friday’s close. From that anchor, it tracks the exchange’s own price discovery. Pre-IPO perpetuals use the same order-book impact mechanism from their initial reference price. Their settings and IPO transition are described in Pre-IPO Markets. The internal oracle follows impact bid and ask prices: the average execution prices for a configured trade amount on each side of the order book. An impact bid above the oracle moves it upward; an impact ask below it moves it downward. If the oracle sits between the impact prices, it remains unchanged. A side with insufficient depth contributes no adjustment. Updates use a continuous-time exponentially weighted moving average (EMA). Sustained changes in the order book accumulate across updates; brief changes have less influence. The time constant controls how gradually the oracle responds. It is not a fixed averaging window or a minimum age that quotes must reach before influencing the oracle.
Here, τ is the configured time constant, with a one-hour default for weekend discovery. Δt* is elapsed time since the previous update, capped at 10% of τ. An insufficient-depth side contributes zero to IPD. If neither side provides an impact price, the internal oracle holds its previous value.

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Session Transitions

When external markets close, the internal pricing session begins automatically, initializing from the last external price. When external data resumes (either from equity futures reopening Sunday evening or Monday’s cash session), the oracle snaps back to the externally-derived price on the next update. Pre-IPO markets follow their separately documented IPO transition.

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Mark Price

The mark price is the price used for margining, liquidations, stop/limit triggers, and unrealized P&L. It is intentionally separate from the oracle price to provide manipulation resistance.

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Three-Component Median

The mark price is computed as the median of three components: The mark price is the median of (1), (2), and (3). Taking the median rather than averaging means a single outlier component, such as a temporarily spiked last trade during thin weekend liquidity, cannot move the mark price beyond what the second-closest component allows. The internal oracle and the mark are distinct. The internal oracle may continue adjusting while the mark is constrained by discovery bounds.

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Clamping

The default limit for mark price updates is 50 basis points of the current mark price per update cycle. For OPENAI’s separate setting, see Pre-IPO Market Specifications. This prevents a single large oracle jump from instantly moving the mark price by the full amount. Instead, the mark price steps toward the new level over successive updates. This is particularly important at the Sunday re-open, when the external price snaps back from the internal weekend price and may carry a gap.

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What Each Price Drives

The mark price drives:
  • Unrealized P&L calculation
  • Margin ratio and available margin
  • Liquidation and ADL triggers
  • Stop-loss and take-profit order execution
The oracle price separately drives:
  • Funding rate calculation
  • Reference price for the start of weekend discovery

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Discovery Bounds

During weekend discovery, the mark is constrained within a percentage range around the last available external price. Current weekend markets have no permitted re-anchors: the reference remains fixed throughout the discovery session.

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How Discovery Bounds Work

The default band width is derived from the market’s maximum leverage, unless a market-specific setting applies:
For example, a 20× market with a reference price of $200 and the default band width has bounds of $190–$210 (±5%). Discovery bounds constrain the mark, not the internal oracle. The mark may remain at a boundary while the internal oracle continues to adjust. Touching a boundary does not reset the reference or halt the market. Pre-IPO markets have separately documented discovery bands and reset allowances.

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Order Protection

Ordinary buy orders above the upper bound and sell orders below the lower bound are restricted; other order-price protections also apply. Liquidation orders are handled separately from this ordinary order-price check. A discovery band does not guarantee that every order can execute.

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When Bounds Reset

When external pricing resumes, the weekend discovery session ends and its bounds are released. The oracle returns to external pricing on the next update. Normal mark-price controls continue as pricing adjusts to the external feed. The next weekend discovery session starts from a new external reference price.

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Risk Management

Positions remain subject to cross-margin requirements, liquidation and ADL. Discovery bounds do not guarantee a maximum account loss or protect other positions in the same account.

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Funding Rate

Funding rates on perpetuals keep the perp price anchored to the oracle price. When the perp trades at a premium to oracle, longs pay shorts. When it trades at a discount, shorts pay longs. The funding rate is calculated using the oracle price as its reference.

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Weekend Funding

During extended sessions, the oracle price is derived from the internal pricing mechanism (see Oracle Price above) rather than external feeds. Funding continues to accrue normally using this internally-derived oracle as its reference, so the funding rate remains meaningful even when external markets are closed. If the internal pricing mechanism lacks sufficient order book data, the premium index is zeroed out rather than calculated from stale or manipulable inputs. This ensures funding payments are never driven by unreliable price signals.

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Dampening Multiplier

Tokenized equity perpetuals carry structural differences from crypto perpetuals. Traditional assets have lower baseline volatility and a known carry cost. To reflect this, Ondo Perps applies a 0.5x dampening multiplier to the funding rate formula for standard equity perpetual markets. This reduces the baseline annualized funding rate from approximately 11% to approximately 5.5%, which:
  • Better reflects the carry cost of holding exposure to traditional assets
  • Reduces the feedback loop between funding payments and internal price discovery during weekends, where thin liquidity can amplify funding-driven price moves
Pre-IPO markets have separate funding settings; see Pre-IPO Markets.