What time does the Kraken contract settle?

Kraken's futures contracts settle at varying times: perpetual contracts daily at 00:00 UTC, and quarterly futures contracts on the last Friday of each quarter at 17:00 UTC.

Nov 12, 2024 at 11:42 am

What Time Does the Kraken Contract Settle?

Kraken, one of the world's leading cryptocurrency exchanges, offers a wide range of futures contracts for traders to speculate on the price movements of various cryptocurrencies. These contracts have specific settlement times, which can vary depending on the contract type. In this article, we will delve into the details of Kraken's contract settlement times and provide a comprehensive guide to help traders understand this crucial aspect of futures trading on the platform.

Understanding Contract Settlement Times

Contract settlement time refers to the specific time and date when a futures contract expires and is settled. At this time, the contract holder is obligated to either deliver the underlying asset (in the case of a physical settlement) or pay or receive the cash equivalent of the difference between the contract price and the market price (in the case of a cash settlement).

Kraken's Contract Settlement Times

Kraken offers two types of futures contracts: perpetual contracts and quarterly futures contracts. Each contract type has its own unique settlement time:

1. Perpetual Contracts: Kraken's perpetual contracts do not have a fixed settlement time. Instead, they continuously roll over, allowing traders to maintain positions indefinitely. However, each perpetual contract has a daily settlement time at 00:00 UTC. At this time, the contract is marked to the current market price, and any unrealized profits or losses are realized.
2. Quarterly Futures Contracts: Kraken's quarterly futures contracts expire and settle on a specific date, which is typically the last Friday of March, June, September, and December. The settlement time for quarterly futures contracts is 17:00 UTC. At this time, the contract is settled in cash, and the difference between the contract price and the market price is paid or received by the contract holder.

Steps to Determine Contract Settlement Time:

To determine the settlement time for a specific Kraken contract, follow these steps:

1. Locate the contract you are interested in on the Kraken website or trading platform.
2. Check the contract specifications, which will include the settlement date and time.
3. Note that the settlement time may vary depending on the contract type, as explained above.

Example:

Let's say you are trading a Kraken quarterly futures contract for Bitcoin (BTC) that expires on March 31st. The settlement time for this contract is March 31st at 17:00 UTC. This means that at 17:00 UTC on March 31st, the contract will expire, and the difference between the contract price and the market price of BTC will be settled in cash.

Conclusion:

Understanding contract settlement times is crucial for futures traders to manage their positions effectively and avoid any potential settlement risks. Kraken offers two types of futures contracts with specific settlement times. Traders should carefully review the contract specifications to determine the settlement time for each contract they trade.