The Evolutionary History of Contract Algorithms: Ten Years of Perpetual Contracts, the Curtain Has Yet to Fall
Core Viewpoint
The ten-year evolution of perpetual contracts: from pulling the plug on 312 to the shocking short squeeze of TRB, a deep dive into the pricing machine that averages $200 billion daily, written with countless liquidations and real money, revealing the painful lessons of risk control.Author: danny
On March 12, 2020, Arthur Hayes of BitMEX made a decision that went against tradition but saved the world—he cut off the network connection to his servers (aka unplugged the network cable). The public announcement stated it was due to a "DDoS attack." But what was the truth?!
The truth is: there were only $20 million in buy orders left on the order book, facing $200 million in pending liquidation sell orders. If the network had not been disconnected, the BTC contract price would have been driven to zero by the liquidation engine itself.
At that moment, the entire crypto perpetual contract market was just minutes away from systemic collapse.
All the seemingly "obvious" mechanisms of perpetual contracts today—mark price, tiered liquidation, U-based, portfolio margin—were forced to be rewritten after that moment.
Introduction: A Concept That Slept for Twenty Years
In 1993, Robert J. Shiller proposed a peculiar derivative concept—no expiration date, no physical delivery required, prices anchored by external data sources, with both long and short parties paying each other at a certain rate. He
Risk warning
