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One trade prints at 203. Which price moved?band 198–202200203Last pricejumps to 203200 → 203band 198–202200203Mark pricestays at 201.50at most 202
One trade prints at 203.Which price moved?Last price200 → 203jumps to 203band 198–202200203Mark priceat most 202stays at 201.50band 198–202200203

One big trade moves the last price. The mark barely moves.

Mark price and last price

The last price is the last trade. The mark price follows the index and moves slowly, so the exchange uses it for liquidation, stops and funding.

Lesson 7 of 85 min3 parts

Updated . Cryptathon rules checked on .

The last price is the latest trade price. On Cryptathon the mark price is the index price plus a smoothed premium from the order book, held within 1% of the index. Liquidation and exit triggers use the mark, not the last trade. A spike in the last price does not trigger them unless the mark reaches the trigger level.

By the end, you can

  1. 1Tell the last price, the index price and the mark price apart
  2. 2Say why one big trade moves the last price but not the mark
  3. 3Say what the exchange uses the mark price for

1 of 3

What are the last, index and mark prices?

The last price is the price of the last trade on the order book. The mark price is a calmer price that the exchange uses to judge your position: on Cryptathon it is the index price plus a smoothed premium from the order book, held within 1% of the index.

The index price is a weighted average of spot prices from other exchanges, with stale or outlier prices left out. It does not come from this order book at all. The mark starts from the index and adds a premium, how far this book trades above or below it.

Worked example

How far can the mark be from the index?

The SOL index price is 200 USDT. What are the lowest and the highest mark prices possible?

  1. 1
    Find the bandThe mark is held within 1% of the index.
    200 × 1% = 2 USDT
  2. 2
    Find the lowest markThe index minus the band.
    200 − 2 = 198 USDT
  3. 3
    Find the highest markThe index plus the band.
    200 + 2 = 202 USDT

AnswerBetween 198 and 202 USDT, however far the last price goes.

SOL price, USDT196198200202204206mark band 198–202Last price 203MarkIndexTime: a few minutes
SOL price, USDT196198200202204206mark band 198–202Last price 203MarkIndexTime: a few minutes
Figure 1 Over a few minutes the index stays near 200. The last price jumps around it, once out to 203. The mark stays inside the band from 198 to 202.
Your turn The ETH index price is 300 USDT. Which of these can be the mark price?
  1. 310 USDT

    That is more than 3% above the index. The mark is held within 1%, so from 297 to 303.

  2. 302 USDT

    Right. 1% of 300 is 3, so the mark can be from 297 to 303.

  3. 290 USDT

    That is more than 3% below the index. The mark stays within 1% of it.

  4. Any price the last trade prints

    The last trade can go anywhere. The mark is held within 1% of the index.

Show the answer

B: 302 USDT. 1% of 300 is 3, so the mark can be from 297 to 303.

2 of 3

Why is the mark price different from the last price?

A large market order can eat through the book and print a trade far from the rest. That moves the last price at once. It does not move the index, because the index comes from other exchanges. The premium is smoothed, so one trade changes it only a little, and the band stops it at 1% in any case.

Worked example

A spike against your short

You hold a 50x SOL short from 200 USDT. Its liquidation price is about 203. The index is 200 and the mark is 201.50. A market buy prints at 203. Are you liquidated?

  1. 1
    Find the jump in the last priceThat is 1.5% in one trade.
    203 − 200 = 3 USDT
  2. 2
    Find the highest the mark can beThe index did not move, and the mark stays within 1% of it.
    200 × 1.01 = 202 USDT
  3. 3
    Compare it with your liquidation priceThe mark is still at least 1 USDT below the trigger.
    203 − 202 = 1 USDT

AnswerNo. The last price reached your liquidation price, but liquidation uses the mark price, and the mark cannot go above 202 while the index is at 200.

SOL price, USDT19619820020220420650x short liquidated ≈ 203One trade at 203Short entry 200Mark 201.50, at most 202Time
SOL price, USDT19619820020220450x short liquidated ≈ 203One trade at 203Short entry 200Mark 201.50, at most 202Time
Figure 2 One trade prints at 203, at the 50x short's liquidation price. The mark is at 201.50 and can go no higher than 202, so the short stays open.
Your turn Why does one big trade move the last price a lot but the mark price only a little?
  1. The exchange ignores big trades

    The trade counts: it sets the last price. It just has little effect on the mark.

  2. The mark follows the index and a smoothed premium

    Right. The index comes from other exchanges, and the premium moves slowly and stays within 1%.

  3. The mark is the average of the last 100 trades

    The mark is built from the index, not from an average of this book's trades.

  4. The mark only changes once an hour

    The mark changes all the time. It is just held near the index.

Show the answer

B: The mark follows the index and a smoothed premium. The index comes from other exchanges, and the premium moves slowly and stays within 1%.

3 of 3

What is the mark price used for?

On Cryptathon the mark price is used for liquidation, take-profit and stop-loss triggers, and funding payments. Those are the moments a single odd trade could hurt you, so the exchange uses the calm price for all of them.

Worked example

A stop-loss that waits for the mark

You hold a SOL long from 200 USDT with a stop-loss at 197. A trade prints at 196.50 for a moment, while the mark is at 198. Later the mark falls to 197. When does your stop fire?

  1. 1
    Check the first dip against the markThe mark is still 1 USDT above your stop.
    198 − 197 = 1 USDT
  2. 2
    Check the later fallNow the mark has reached your stop.
    197 − 197 = 0 USDT

AnswerThe stop fires only when the mark reaches 197, not on the dip of the last price to 196.50.

SOL price, USDT192194196198200202Stop-loss 197Long entry 200Last 196.50: no triggerMark 198Stop firesTime
SOL price, USDT192194196198200202Stop-loss 197Long entry 200Last 196.50: no triggerMark 198Stop firesTime
Figure 3 The last price dips to 196.50 for a moment and the stop at 197 does not fire. Later the mark falls to 197 and the stop fires.
Your turn You hold a long with a take-profit at 210. A trade prints at 210.50, but the mark price is 208.50. What happens?
  1. The take-profit fires at 210.50

    Take-profit fires on the mark price, and the mark is at 208.50.

  2. Nothing yet

    Right. The mark is 1.50 USDT below your take-profit, so it has not fired.

  3. The take-profit fires at 208.50

    It cannot fire below your level. It waits until the mark reaches 210.

  4. The take-profit is cancelled

    It stays in place and waits for the mark.

Show the answer

B: Nothing yet. The mark is 1.50 USDT below your take-profit, so it has not fired.

Common questions

Does your order fill at the mark price?

No. Orders fill on the order book, at the prices of the orders they trade with, best price first, then first come, first served at each price. The mark price only decides when a stop-loss, take-profit or liquidation fires. A stop then trades as a market order, so it can fill a little away from your level. On Cryptathon a market order fills only within 1% of the mark price.

Why does the mark price move when nobody trades?

The mark price starts from the index price, and the index is built from spot prices on other exchanges. When BTC moves on those exchanges, the index moves, and the mark moves with it, even if no one trades on this order book. If the index goes from 100,000 to 101,000 USDT, the mark can be anywhere from 99,990 to 102,010 USDT.

Can the mark price and the last price be far apart?

Yes. One big trade can print a last price away from the rest, but the mark is held within 1% of the index. With the SOL index at 200 USDT, the mark stays between 198 and 202 USDT, even if a trade prints at 203. A liquidation or a stop fires only if the mark reaches its trigger level.

Check yourself

Three questions on the whole lesson.

Question 1 of 3 The SOL index price is 150 USDT. What is the highest the mark price can be?
  1. 151.50 USDT

    Right. 1% of 150 is 1.50, so the mark can be at most 151.50.

  2. 165 USDT

    That is 10% above the index. The band is 1%.

  3. 150.15 USDT

    That is 0.1%. The band is 1% of the index.

  4. There is no limit

    The mark is held within 1% of the index.

Show the answer

A: 151.50 USDT. 1% of 150 is 1.50, so the mark can be at most 151.50.

Question 2 of 3 Which price does the exchange use to work out a funding payment?
  1. The last price

    Funding, like liquidation and stops, uses the mark price.

  2. Your entry price

    Funding uses the price at the funding time, the mark.

  3. The mark price

    Right. Funding payments use the mark price.

  4. The index price only

    The index feeds the mark, but the payment uses the mark.

Show the answer

C: The mark price. Funding payments use the mark price.

Question 3 of 3 Your 10x long is liquidated near 181 USDT. A trade prints at 180.50, but the mark is 182. What happens?
  1. The position is liquidated at 180.50

    The trigger uses the mark price, and the mark is at 182.

  2. The position stays open

    Right. The mark is still 1 USDT above your liquidation price.

  3. The exchange closes half the position

    Nothing is closed until the mark reaches the liquidation price.

  4. You pay the liquidation penalty

    There is no penalty while the position is open.

Show the answer

B: The position stays open. The mark is still 1 USDT above your liquidation price.

What to remember

  1. What are the last, index and mark prices?Last price is the last trade; mark price is the index plus a smoothed premium, held within 1%.
  2. Why is the mark price different from the last price?One trade can move the last price a long way, but not the index, so the mark stays put.
  3. What is the mark price used for?Liquidation, take-profit, stop-loss and funding all use the mark price.
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