Fair Price Indexing

Fair price indexing is the method of using a weighted average of prices from multiple exchanges to determine the mark price of an asset. This prevents individual exchanges from experiencing artificial liquidations due to localized price manipulation or flash crashes.

By aggregating data from various sources, the protocol creates a more robust and representative price. This price is used for calculating liquidation levels and account equity.

It is essential for protecting traders from malicious price spikes on a single venue. Fair price indexing ensures that the liquidation engine operates based on the global market reality.

It is a fundamental defense against market microstructure manipulation.