whaletail documenation

Synthetic Dollar Overlay (SDO) manual initial setup

To keep your investment adjusted to dollar value, we need to set up an initial SDO. Currently, this process is performed manually by the customer. Follow the below steps to set your SDO on the BitMEX trading platform.


Step 1: Rounded dollar vale

After bitcoin funds landed in your BitMEX account, go to the BitMEX web interface. Click on the wallet (image 1: A), round Total Balance (image 1: B) to 100 and remember the value – we will need it in step 3.
In our example, the rounded Total Balance is 8,100 USD

Image 1: click to enlarge

Step 2: Futures contract

To head to the appropriate Futures contract, click Derivatives in navigation (image 2: A) and click on the contract dropdown (image 2: B). In the search field type the appropriate contract symbol (image 2: C) and click on the contract hit (image 2: D).

appropriate contract:
Always choose a quarterly expiration contract that expires next from the date you are setting up SDO.

Setting SDO on July 1, 2022, we choose a quarterly expiration contract XBTU22 which expires on Sep 30, 2022.

More information about BitMEX Future contracts › here.

Image 2: click to enlarge

Step 3: Short trade

While in the appropriate Future contract user interface, choose Market order type (Image 3: A), set Size as rounded Total Balance from step 1 (Image 3: B), click on the Sell Market button (Image 3: C) and confirm the sell order.

In order to avoid paying trading fees in case of larger contract size, choose Limit order type instead of Market. In this case set Limit Price slightly above current ask price, eg. 100 USD. For current ask price make sure you have Orderbook module displayed on BitMEX user interface.
You have to wait for order to get fully filed. In rare cases of Limit order and very volatile market conditions it is possible the order might not get filled. In this case cancel the order, and go through the process again with new current price until order gets fully filed.

Image 3: click to enlarge

Congratulation, your SDO is set. This ensures your bitcoin deposit remains stable against bitcoin/dollar fluctuations. In the same way as if you deposited fiat currency eg. dollar.