How do corporate actions affect your on-chain assets and perpetual futures?

How do corporate actions affect your on-chain assets and perpetual futures?

This FAQ explains how corporate actions affect your ExchangeOS tokenized stocks and ETFs, spot orders, perpetual futures positions, prices, and deposits and withdrawals.

1. What corporate actions can affect my ExchangeOS assets and trading?

A corporate action is a change announced by the company or fund behind an asset. ExchangeOS adjusts affected assets and markets to reflect stock splits, reverse stock splits, stock dividends in the same stock, and cash dividends. The effect depends on the event and what you hold. Your token balance, open orders, and perpetual futures position may need different adjustments. If you hold an affected token without an ExchangeOS spot trading pair, your balance still receives the applicable asset adjustment; there are no spot orders to adjust.

2. How do corporate actions affect my ExchangeOS token balance?

Your token balance changes to reflect the conversion confirmed for the event. For splits and reverse splits, the number of units and the price per unit change in opposite directions.

For the tokenized assets covered here, cash dividends, including small cash dividends, are reflected through additional tokens of the affected asset. You don't receive a separate cash payment just because the underlying company announces a cash dividend.

The token issuer's multiplier is a conversion factor used to adjust your token balance. ExchangeOS uses the conversion confirmed for the event to update the number of tokens you hold. The issuer's token update can take effect separately, so deposits and withdrawals may remain paused after your ExchangeOS balance changes.

For example, assume a two-for-one split applies directly to your tokens:

More tokens don't automatically mean more profit. A split changes both quantity and price, and a dividend can also involve a price adjustment. Your spot adjustment follows the token issuer's conversion, while perpetual futures follow the applicable terms for the underlying stock; the two adjustments don't have to be identical.

Note: this example ignores market movements and rounding. It doesn't guarantee your account value.

3. How do corporate actions affect my ExchangeOS perpetual futures positions?

The treatment of your position, balance, and profit and loss (PnL) depends on the event:

For a split, reverse split, or stock dividend in the same stock, ExchangeOS settles your existing position at the mark price before the adjustment. It then reopens the adjusted position at the mark price after the adjustment, after rounding its size to a supported increment. A position that's too small to represent after rounding isn't reopened.

Your new average entry price is the mark price used to reopen the position. The old position's PnL becomes realized when it settles. The reopened position then tracks unrealized PnL from its new entry price. ExchangeOS doesn't charge trading fees for this corporate action settlement and reopening; trades you place remain subject to the usual trading fees.

For a large cash dividend, the credit or debit depends on your position size and the applicable dividend amount, in the contract's settlement currency. It affects your cross margin balance or, for isolated margin, the balance allocated to that position. Applicable reference and order prices also decrease. A credit alone doesn't represent an extra investment profit.

For a small cash dividend, ExchangeOS doesn't separately adjust your perpetual futures position, orders, or settlement balance. Prices continue to reflect market movements. These treatments also apply to affected ETF perpetual futures.

4. How do corporate actions affect my ExchangeOS open orders and TP/SL settings?

ExchangeOS adjusts the remaining unfilled part of affected open orders. Past trades remain records of what actually filled before the adjustment.

For example, if 4 tokens from a 10-token spot order have already filled, only the remaining 6 need an order adjustment. In a two-for-one adjustment, that remainder becomes 12 tokens at the adjusted order price, before rounding. The earlier fill remains a record of the original trade.

For affected perpetual futures take-profit, stop-loss, and trigger orders that haven't triggered, ExchangeOS also adjusts the relevant trigger prices and any preset limit prices. Applicable fixed quantities change for splits and stock dividends, but stay the same for a large cash dividend. An order for your entire position follows your position size when it triggers.

Adjusted prices and quantities must fit the market's supported increments. ExchangeOS rounds quantities down, buy order prices down, and sell order prices up. If an order's quantity becomes zero or a required order or trigger price is no longer valid, ExchangeOS cancels it. Cancellation itself doesn't create a trade.

ExchangeOS also recalculates the assets reserved for affected spot orders: the token for a sell order, or the payment asset for a buy order. Canceling an order releases the assets reserved for its unfilled part. Adjustments and rounding can also change the amount reserved; a release isn't a separate dividend or profit. Review your adjusted orders and TP/SL settings to make sure they still match your trading intention.

5. How does ExchangeOS adjust prices for a corporate action?

ExchangeOS updates the applicable reference price to reflect the event. A split changes the price per unit to match the new share basis. A cash-dividend adjustment reduces the reference price by the applicable dividend amount per unit, expressed in the correct pricing currency.

These examples illustrate the reference-price change where that adjustment applies, ignoring market movements and rounding. Small cash dividends don't use this full price-adjustment process.

The index price provides a reference for pricing. The mark price supports position valuation and liquidation checks. The last traded price reflects the latest trade, with an adjustment at the event where applicable. These prices serve different purposes and don't have to match. A 2 USD reference-price adjustment doesn't guarantee that the mark price also falls by exactly 2 USD.

6. How do ExchangeOS price limits change during a corporate action, and when do they return to normal?

ExchangeOS temporarily narrows the range of acceptable order prices while the market adjusts. For events that require a price adjustment, it holds the index reference, applies the corporate action, and then returns to market pricing gradually.

The fixed reference helps avoid mixing prices from before and after the event. The gradual return begins after external prices reflect the corporate action and the required checks and approval are complete.

Normal price-limit settings resume when that gradual return begins. They don't resume simply because your balance or position adjustment has finished, and they don't have to wait until price recovery is complete. The permitted range can still move as the reference price and other market inputs change.

An order that normally falls within the permitted range may fall outside the tighter range and be rejected. Check the latest permitted prices and your order details before submitting it again. Small cash dividends don't use the full price-adjustment process described here.

7. Can I trade during an ExchangeOS corporate action, and what risks remain?

An ordinary corporate action in ExchangeOS doesn't introduce a separate post-only trading period. Trading, liquidations, and auto-deleveraging continue under the applicable rules, subject to temporary price limits and order adjustments.

A fixed index reference doesn't freeze your mark price, unrealized PnL, or margin position. The mark price and price limits continue to use other valid market inputs, so your account value and risk can still change. Monitor your margin and positions throughout the adjustment. A fixed reference or tighter price limits don't guarantee an execution price or protect you from losses or liquidation.

8. How are corporate actions reflected in my ExchangeOS records and charts?

The records depend on the adjustment:

A perpetual futures settlement realizes the old position's PnL, while the reopened position starts tracking unrealized PnL from its new entry price. These changes can affect how your earnings appear. A token balance adjustment isn't a spot purchase or sale, and a release of reserved assets isn't additional income.

ExchangeOS also adjusts historical chart prices and related percentage-change data where needed to make prices from before and after the event comparable. For example, a split can lower the price per unit without representing an equivalent market loss. Chart adjustments don't rewrite the trades you actually made.

9. Why are ExchangeOS deposits and withdrawals paused during a corporate action, and when do they resume?

The token issuer and ExchangeOS may apply the corporate action at different times. Transfers during that gap could use token quantities from different stages of the adjustment. Temporarily pausing deposits and withdrawals for the affected asset helps prevent incorrect transfers while those changes take effect.

Deposits and withdrawals resume after the ExchangeOS adjustment is complete, the issuer's corresponding token update has taken effect, and the required platform checks and permission to resume are in place. An expected update time alone isn't enough.

A completion notice confirms that the corporate action adjustment has finished. Price recovery and deposit and withdrawal recovery follow separate conditions:

A completion notice or removal of a trading-page banner doesn't confirm that deposits and withdrawals are available. Check the affected asset's transfer status before attempting a transfer. A pause for one asset doesn't mean deposits and withdrawals have stopped for every ExchangeOS asset.

10. How will ExchangeOS notify me, and what should I check after a corporate action?

For ordinary adjustments, ExchangeOS provides event information on the affected trading page and sends relevant notifications if you hold the asset, have a position, or have an open order. If the asset has no trading pair, notifications apply to holders of that asset.

For small cash dividends, you receive a completion notification after the token balance adjustment, without an advance corporate action banner or reminder.

Check the event details and review your token balance, position size, average entry price, open orders, and take-profit and stop-loss settings after the adjustment. Check the related balance and trading records to understand any changes to your PnL, and confirm deposit and withdrawal availability separately.

Crypto products involve significant risk. Prices can go up and down, and you may get back less than you put in. This article is for informational purposes only and is not financial, investment, or tax advice. Please do your own research and seek independent advice before making any investment decisions.