Bitget Call Auction: Overview, Benefits and Guidelines

If you're familiar with financial markets, you've likely heard of ‘call auction’ before. It refers to a type of trading where buy and sell orders are submitted and matched at predetermined time intervals, resulting in a single opening price. In the crypto world, call auction lets traders submit orders for a new token based on their expected price before a new token is officially listed. These orders are then ranked and matched based on price and time priority, allowing the system to determine an opening price for the token.

Bitget's recently launched Call Auction aims to reduce the market volatility caused by low liquidity before a new token listing. This initiative reaffirms Bitget's user-centric philosophy—providing tools that help our users thrive in the fast-paced crypto market.

Key Benefits of Call Auction

Fair Trading for All: The call auction enables all investors to trade at the same price, ensuring market fairness and preventing market prices from being swayed by the trades of individual investors.

Enhanced Liquidity: By bunching many buy and sell orders together, liquidity is significantly increased and this can cut transaction costs for investors.

Reduced Price Volatility: Call auctions are great for stabilizing prices when the market opens. Often, investors are wary of sudden price swings, but call auctions help boost confidence by offering more predictable pricing at the token’s launch.

Reflective Market Sentiment: The opening price of a token reflects the collective view of all investors involved. With call auctions, the market integrates all available information, resulting in a smarter opening price that helps investors make better decisions.

How Does Call Auction Work at Bitget?

Bitget's Call Auction process is straightforward and involves two main components: the pricing mechanism and the trading rules. The system sorts orders based on price priority and time priority. Here are the key factors involved in determining the opening price:

1. Maximizing Matchable Volume: The opening price is set where the largest volume of orders can be matched.

2. Orders higher or lower than the opening price: Buy orders with prices higher than the opening price, and sell orders with prices lower than the opening price can be fully executed.

3. Orders equal to the opening price: At least one side (buy or sell) will be fully filled.

4. If the maximum trading volume can be matched at two or more opening prices at the same time, the system will choose the price with the smallest spread relative to the market maker's reference price as the opening price. If no reference price is provided by the market maker, the system will select the lowest of these potential opening prices.

Example: If a token is about to be listed for trading, the system begins matching orders in the call auction. User A submits four buy orders at a limit price of 1 USDT, User B submits four buy orders at a limit price of 0.99 USDT, User C submits eight sell orders at a limit price of 1.01 USDT, and User D submits four sell orders at a limit price of 1 USDT.

In this scenario, the system will set the opening price at 1 USDT because it achieves the highest cumulative total volume at that price.

In simpler terms, imagine a marketplace where everyone gathers to trade their items. The system sets the trading price to ensure that most participants get what they want.

Call Auction Phases

Call auctions at Bitget unfold in three distinct phases, each with its own timeframe. It's crucial for users to be aware of these phases and adjust their bidding strategies accordingly.

Phase 1: Before Opening

Typically, it lasts hours, though specific timings vary depending on the token. Users should monitor announcements for exact schedules. At this stage:

● Only Good-til-Canceled (GTC) limit orders are allowed, with no support for other order types.

● Order cancellation is supported;

● Order modification is not supported;

● Orders are placed freely, but no trades are executed at this stage.

Phase 2: Approaching the Opening

This phase typically lasts minutes, with exact timings depending on the token. Users should monitor announcements for exact schedules. At this stage:

● Only Good-til-Canceled (GTC) limit orders are allowed, with no support for other order types.

● Order cancellation is not supported;

● Order modification is not supported;

● Users can continue to place orders, but no trades are executed at this stage.

Phase 3: Matching and Pricing

This phase typically lasts seconds, with exact timings depending on the token. Users should monitor announcements for exact schedules. At this stage:

● GTC orders are not supported;

● Order cancellation is not supported;

● Order modification is not supported;

● The system finalizes the opening price based on pricing rules.

At this stage, all orders that can be matched will be executed and the transaction prices are determined according to the above pricing rules and the final opening price. The final settlement between the buyer and the seller is:

	Pay	Receive
Buyer	Opening price x Buy quantity	Buy quantity - Transaction fee
Seller	Sell ​​quantity	Sell quantity x Opening price - Transaction fee

It should be noted that transaction fees for orders filled in call auctions will be charged according to taker fee rates

The remaining unfilled orders are automatically carried over to the regular trading session (the order book).

Call Auction Failure Processing

Bitget enforces certain criteria to ensure fair pricing during call auctions. If these conditions aren't met, the call auction may fail. Here are the main reasons for call auction failure:

● Excessive Bid-Ask Spread: If the highest buy price and the lowest sell price have a significant gap, the call auction may fail.

● Low Matchable Volume: If the volume of matchable orders is too low, the call auction may also fail. The minimum required matching volume for each call auction will be disclosed in the announcement corresponding to that trading pair.

When a call auction fails, there are two possible outcomes:

1. The trading pair may be delisted immediately.

2. The trading pair may remain open, with the opening price set based on the market maker’s recommended price.

The specific approach will be detailed in the listing announcement prior to the call auction's commencement. If the auction fails, all participating orders will be canceled to protect users from potential losses, regardless of whether trading continues.

A Smarter Way to Trade

At Bitget, we're committed to constant innovation and enhancing our platform's features and resources. We strive to equip traders with the latest market intelligence tools they need to stay ahead of the game, whether they're just starting out or are experienced investors. Our mission is simple: to help you trade with greater confidence and success!