Mark Price Calculation | Paradex

Perpetual Mark Price Formula

The mark price of a perpetual future instrument is calculated as :

\text{Mark Price}=\text{Spot Oracle Price}*(1+\text{Fair Basis})

where :

$\text{Spot Oracle Price}$ is an external oracle price of the underlying coin obtained via the Pyth & Stork Networks.

Fair Basis

Fair Basis measures how rich or cheap the perp is versus spot. It is built from three sources, each treated as one vote:

On-venue quotes: Paradex best bid, best ask, and last trade, each expressed as a basis $(\text{price} - \text{spot}) / \text{spot}$ .
On-venue mid: basis computed from the Paradex bid/ask mid.
External venues: per-venue basis $(\text{venue mark} - \text{spot}) / \text{spot}$ for each external venue (Binance, Bybit, OKX, Hyperliquid, and Lighter).

All inputs are EWMA-smoothed before use. The smoothed bases are then combined through two successive medians so no single feed can dominate:

\begin{aligned} & \text{InternalBasis} = \text{median}\big( \text{BidEWMA},\ \text{AskEWMA},\ \text{TradeEWMA} \big) \\ & \text{ExternalMedian} = \text{median}\big( \text{basis}_{\text{venue}_1},\ \text{basis}_{\text{venue}_2},\ \ldots \big) \\ & \text{LiquidBasis} = \text{median}\big( \text{InternalBasis},\ \text{MidEWMA},\ \text{ExternalMedian} \big) \end{aligned}

The published Fair Basis blends the external median with the liquid basis, weighted by an on-venue liquidity score $w \in [0, 1]$ :

\text{Fair Basis} = (1 - w) \times \text{ExternalMedian} + w \times \text{LiquidBasis}

Liquidity weight

A tick is liquid when both bid and ask are present and the relative spread is within the per-market Max Top-of-book Spread (1%). The weight $w$ ramps linearly toward 1 on liquid ticks and toward 0 on illiquid ticks, traversing the full 0-to-1 range over 30 minutes of sustained conditions.

Sustained thinness drives $w \to 0$ and Fair Basis follows external consensus; sustained tightness drives $w \to 1$ and on-venue signals regain equal weight.