How to use Paradigm with SignalPlus

SignalPlus supports making trades on Paradigm directly. Paradigm provides institutional grade liquidity which allows users to trade with counterparty and settle in Bybit or Deribit.Currently instruments supported are Deribit BTC options strategy, Deribit ETH options strategy, Derbit, Bybit BTC options strategy, Bybit ETH options strategy, Deribit BTC Inverse Contracts, and Deribit ETH Inverse Contracts.

Terminology

Paradigm

Paradigm platform https://www.paradigm.co/。

Paradigm API

API generated on Paradigm and connect SignalPlus for trading purpose

OTC Account

Corresponding Bybit/Deribit accounts for settlement purposes

RFQ

Request For Quote, originally Paradigm DRFQ function. This function allows you to request for quote to specific counterparty with set qty when quoting

OrderBook

Open orderbook, originally Paradigm GRFQ function. This function allows you to request for quote to all the counterparties in the market

Ratio

The ratio of each leg when creating strategy quoting

Screen Price

Asking and bidding price from the exchange for reference purpose

1. Before You Trade

Before you use SignalPlus to do OTC trading on Deribit/Bybit, you need following checklist:

Register Paradigm account
Connect your Paradigm to Derbit or Bybit account for settlement purpose
Generate Paradigm API
Connect Paradigm API to SignalPlus
Match your Derbit/Bybit account on SignalPlus to the one on Paradigm

You can find more details below

How to create API Keys - Paradigm

2. Taker

As a taker, you can

Create RFQ or OrderBook
Select best bid/ask to execute a trade

2.1 Create RFQ or OrderBook

You can use a few ways below to create RFQ or OrderBook

I. From Option Chain

In the option chain under Derbit/Bybit, select the contract you would like to trade, and click the OTC button on the top right corner in the popup window

Select Auction Type and Confirm Details

Click Send RFQ or Create OrderBook, and you will see your RFQ or OrderBook in the new window

II. From Smart Dealing

1) In the Smart Dealing module under Deribit/Bybit accoount, once you have built your strategy, you can Send to OTCEmbed anything (PDFs, Google Docs, Google Maps, Spotify…)2) Similarly, you will need to select auction type and confirm details

Auction

RFQ

OrderBook

Info

A. Enter the trade qty of each leg (must satisfy minimal order size) B. If there is any hedge leg, you need to enter desired price for the hedge leg C. Select counterparties D. Choose to be anonymous or not (you have to select at least 3 LP when choose to be anonymous)

A. Enter the ratio of the legs (at least one of the leg needs to be 1) B. If there is any hedge leg, you need to enter desired price for the hedge leg

Click Send RFQ or Create OrderBook, and you will see your RFQ or OrderBook in the new window

III：Fram Paradigm Account

Enter into Paradigm Account and select Market module
Choose auction type between Create OrderBook or Create RFQ

3) Enter the strategy details

Auction

RFQ

OrderBook

Info

A. Select Exchange B. Select Currecy C. Construct Strategy - Enter Leg Info - Enter Qty for Each Leg - If there is any hedge leg, you need to enter desired price for the hedge leg D. Select counterparties E. Choose to be anonymous or not (you have to select at least 3 LP when choose to be anonymous)

A. Select Exchange B. Select Currecy C. Construct Strategy - Enter Leg Info - Enter Qty for Each Leg - If there is any hedge leg, you need to enter desired price for the hedge leg

Click Send RFQ or Create OrderBook, and you will see your RFQ or OrderBook in the new window

2.2 Select best bid/ask to execute a trade

Auction

RFQ

OrderBook

Display

After taker initated RFQ, the taker can recieve quote from assigned counterparty

After taker create OrderBook, anyone can quote on the OrderBook

2.2.1 Execute Your Trade From the List

Review the list

RFQ: you can review requested RFQ and Received RFQ with bid/ask information under Market module
OrderBook: you can review the OrderBook you created with bid/offer information under Market module

2）When you move your cursor to each line, there will be Sell or Buy button on each side. And you can buy or sell the instruments using best ask/bid price as a taker.

Note: when auction type is RFQ

your settlement account will be fixed at the time of RFQ and cannot be changed
Trade qty will be fixed at the time of RFQ and cannot be changed

If you wish to see more layers of price on the list, you can click on the instrument to expand the row to see more prices and Screen Price

You can click into the instrument to see more detail of the instrument

3. Maker

3.1 Receive RFQ and submit quotes

3.3.1 Receive RFQ

If some one sends you a RFQ, you will receive a push notification on SignalPlus

Click to quote - you can see more quote details in the popup window

In the popup window, it will show

From which counterparty, or from anonymous party
Basic information for this RFQ including exchange, instruments, ratio and qty
Mark Price, SP Model Price, and Screen Price from the exchange

Submit Quote

Submit Bid: Enter price in green area to submit bid price
Submit Ask: Enter price in green area to submit ask price
Submit two-way price: Enter both ask and bid price and click Submit Two-Way Price button in the middle to submit two-way price

Note: when submit your quote, you need to first select the exchange account on the top left corner. In addition, your Bid price cannot be higher than Ask price.

4）You will see your quote on the page once your quote is submitted successfully, as indicated below. You can also cancel or modify the quote.

Note: you can only submit 1 bid and 1 ask on a single RFQ. New quote will overwrite the original quote automatically.

3.3.2 Review OrderBook Quote

In the Market - OrderBook page, you will see all the public quote from everyone. And you can filter the OrderBook by exchange, coin, and strategy.

Click the quote to see more details of the OrderBook from a popup window

In the window, it willl show

Basic information for this quote including exchange, instruments, and ratio
Mark Price, SP Model Price, and Screen Price from the exchange

Submit Quote

Submit Bid: Enter price in green area to submit bid price
Submit Ask: Enter price in green area to submit ask price
Post Only: If you do not wish to be a taker when submitting the quote, you can check Post Only. When Post Only is checked, your order will be cancelled if you would be a taker when submmiting the quote

You can quote at most 2 bid and 2 ask on a single OrderBook. If more quotes need to be submitted, the system will ask you to cancel old orders.

3.2 Cancel Quote

After submitted your quote, you have following ways to cancel your quote:

I. Click the “x” button within My Bid or My Ask column

II. Click Kill Bitds/Kill Asks/Kill All on top of the list

III. Go to History section and find the orders you would like to cancel

3.3 Order Filled

If the quote submitted is filled, you will see a notification on the page similar to below

4. SignalPlus Tools

SignalPlus provides following tools within Paradigm for your convenience

Tool

Function

Quote by Leg

Pricing and quoting tool - based on the current bid and ask, in addition to some adjustments to each leg, to get total Strategy Bid and Strategy Ask

Quote by Spread

Pricing and quoting tool - consider the entire strategy as a whole with a baseline, and enter the spread for bid and ask respectively, to get total Strategy Bid and Strategy Ask

Break Even

Break Even analysis for the proposed trades and impact to existing positions

Risk Scenario

Simulation tool - to see the PnL and Risk under different scenario

4.1 Quote by Leg

Open the detailed popup window and click to expand SignalPlus Tools

Select Quote by Leg to show information for each leg
You can adjust adjust the quote price for each leg
1. The direction of quoting - Bid or Ask
2. Price method: IV, BTC or USD
3. Price reference baseline: Mark, SP Model, Mid, Bid0, or Ask0
4. Adjustment to the baseline, such as +xx% or -xx%
5. The system will show the final calculation of each based on the entries you made
6. The final Strategy Bid or Strategy Ask will be calcuated by the result of each leg

With the final Strategy Bid or Strategy Ask, you can apply this quote to the submission box above.

4.2 Quote by Spread

Open the detailed popup window and click to expand SignalPlus Tools

Select Quote by Spread to show information for each leg
Select Mark, SP Model, Mid, Bid0, Ask0, or Customize as baseline
Enter the desired spread
If Offset Shade is checked, the spread between Strategy Bid and Strategy Ask will be allocated automatically.
With the final Strategy Bid or Strategy Ask, you can apply this quote to the submission box above.