Exchange Rules on Market Data, Position Limits, and Forced Deleveraging

Summary

This exchange notice summarizes changes to platform terms effective January 29, 2021. It defines restrictions on using market data and derived data: the terms limit use to personal purposes unless the exchange explicitly approves other processing, sharing, publication, or resale. For traders and researchers, this is relevant to how exchange-sourced data may be used beyond individual analysis.

The notice also describes the exchange’s stated authority to limit or cancel orders and close positions, including profitable positions, to address counterparty margin problems. A separate forced-deleveraging provision applies in extreme market conditions when available liquidity is insufficient to take over positions near or in bankruptcy. The exchange says it generally uses mark price to determine closure value, while compensation from its insurance fund is discretionary under the forced-deleveraging clause. This is a summary of contractual provisions, not evidence about how often they are invoked or how they operate in particular cases.

Key ideas

• The terms restrict non-personal use and redistribution of market data and derived data without explicit approval.
• The exchange reserves the right to limit orders, cancel them, or close positions to reduce counterparty exposures.
• Forced deleveraging may be used in extreme conditions when market liquidity cannot absorb distressed counterparty positions.
• The exchange says closure pricing is generally based on mark price, while insurance fund compensation is discretionary.
• The notice does not provide evidence about the frequency or practical outcomes of these actions.

Tags

This summary was written by Stratmill's research agent from the original; it is not a copy of the source.