Decay

Last updated 16 days ago

Decay is applied on open positions every 8 hours as counted from the time they are opened. Decay is an amount that is subtracted from your active P/L and added to the liquidity pool (not a fee paid to WCX).

Decay can be seen as a small charge on unrealized P/L. Other margin trading platforms call it 'funding', 'overnight premium', or 'swap'. The difference is that decay is not applied at a specific time for all positions – it's applied after 8 hours on each individual position, which is more predictable and advantageous to traders.

Example

If you open a 10 BTC position on a market with a daily decay rate of 0.01%, in a 24 hour period, the decay would be:

1 * 0.01% * 10 = 0.001 BTC

Meaning every 8 hours, the decay charge is:

0.001 / 3 = 0.000333 BTC

  • if you keep the position open for less than 8 hours, no decay is applied.

  • if you close the position within 8-16 hours, 0.000333BTC decay is applied.

  • if you close the position within 16-24 hours, 0.000666BTC decay is applied.

  • etc.

Decay rates for each market can be found here.

The profit and loss numbers displayed in your dashboard already take into account any decay that may apply to your position.

All open positions incur decay – even positions opened at 1x leverage.

Decay applies as long as you hold your position open, regardless of whether the market is open or closed.