Notes on Lightning Futures and Risk

When performing trades on bitFlyer Futures, please thoroughly read both this document and the document outlining Risks of Using Virtual Currency.

1. Fees

Please refer to the Fees and Taxes page for more information on Lightning Futures transaction fees.

2. Margin

In order to make trades on bitFlyer, you must deposit a margin as noted in the Lightning Futures Trading Rules page. It should be noted that the value of trades may exceed the margin you deposited, so your losses may exceed your margin.

3. Risks of Lightning Futures Trading

(1) Risk of Price Fluctuation

In Lightning Futures trading, losses may occur due to fluctuation in prices of digital currencies that are underlying assets of trade products. Furthermore, the transaction amount can be larger than the amount of margin deposited by a customer, and losses may exceed the total margin deposited. Note that unexpected or specific events, including but not limited to changes to the balance of supply/demand; changing price of commodities, fiat currency, or other markets; natural disasters; wars; change to laws, regulations, statutes, and the government; and changes to virtual currency may cause drastic price fluctuations that cause the order to fail to fulfill or transact as intended. Please note that prices may in some cases reach zero.

(2) Liquidity Risk

Note that market changes or trading volume may cause a customer to be unable to close open positions or open new positions, and such changes may also result in transactions at undesirable rates. Where an order is delayed, either on the buy or sell side, it may take some time for the order to complete, or it may fail to fulfill.

(3) Risk of Sell Out If we determine that your margin maintenance rate has dropped below the standard we set, we may cancel all outstanding open positions based upon our Margin Call Rules and Sell Out Rules, regardless of your intent. Furthermore, if your margin maintenance rate drops below the standard we set, all of the outstanding positions in your Lightning Futures account will be automatically counter-traded and settled (Sell Out Order). Even in the event of a loss cut, it is possible that the amount lost due to a dramatic and rapid change in the market will cause losses to exceed the margin deposit.

Profit and loss (valuation), required margin, etc. are combined across Lightning FX/Futures markets (positions on different markets do not offset each other.) If you hold a position on multiple markets, please be aware of the risks associated with sell outs due to precipitous market price fluctuations on a given sheet.

∗ Please see the Lightning Futures Trading Rules page for more information on the Sell Out Rules.

(4) Credit Risk

If our company's operational or asset situation worsens, you may be subject to losses in your Lightning Futures trades.
We manage the margins received from customers separately from our own funds.
However, it is not bankruptcy-remote and in the event that our company goes bankrupt and client fund safety measures are enacted, the margin may become merged with general assets and not returned.

(5) Swap Point Risk

Regardless of fluctuations in the price of the virtual currency etc which is an underlying asset of the transaction, rolling over short positions or long positions of the product will result in payment of swap points.
bitFlyer determines the swap points daily based upon interest rates.
Depending upon changes in interest rates or changes in the price of the virtual currency etc which is an underlying asset of the transaction, swap points may change, and you may not be able to receive the swap points you hoped for.

∗ Please see the Lightning Futures Trading Rules page for more information about swap points.
∗ For the purposes of Lightning Futures trading, a roll over is defined as a position that is reverse traded on the same day carried over to the following business day. If a a position is not settled with a counter-trade by the maturity date, the position will automatically be settled at the settlement price (SQ) determined on the maturity date.

(6) Risk of Use of Electronic Trading Systems

Please carefully read Section 6: System Risks in the "Risks of Using Virtual Currency" document.

(7) Other Risk

  1. The spread between the buying price and selling price may widen due to sudden market fluctuations, and you may not be able to make the trade you intend.
  2. Trading may be limited for reasons that are unavoidable, including natural disaster, political upheaval, strikes, or sudden disruption or closure of Virtual Currency markets. It is possible for customers to incur unexpected losses as a result.
  3. If in the future the taxation and legal system surrounding Lightning Futures trading changes, it may result in adverse trading conditions.

Management of assets received from customers

The margin that we collect from you for Lightning Futures transactions will be clearly marked as funds that were collected from you as a deposit and managed separately from our own funds.
In the event that our company is unable to continue doing business, bankruptcy procedures (which include dealing with customer assets) will be carried out in accordance with applicable laws (bankruptcy law, corporate law, corporate reorganization law, civil rehabilitation law, etc.).

4. Explanation of Important Matters

(1) It is possible to suffer significant losses through Lightning Futures transactions due to fluctuations in the price of Bitcoin. It is also possible to suffer losses due to changes in our company's management or financial conditions or changes in external evaluation. Such damages may exceed the value of the margin.

(2) bitFlyer trading system

For more information on the bitFlyer trading methods, margins, etc., please carefully read the Lightning Futures Trading Rules page.

(3) Outline of contracts related to Lightning Futures

Lightning Futures transactions at our company are subject to the following:


(4) Please refer to the Fees and Taxes page for an outline of taxation related to Lightning Futures trading

(5) Outline of business and methods our company engages in related to Lightning Futures trading

Lightning Futures trading is subject to the following:

Company Outline

Company Name
bitFlyer Co., Ltd.
Address of Headquarters
Midtown Tower 8F, 9-7-1 Akasaka, Minato-ku, Tokyo 107-6208, Japan
Contact
https://bitflyer.com/en-jp/contactpage
URL
https://bitflyer.com/en-jp/