One of the attractive and ambitious indices of the cryptocurrency market is the BlueBird Index, introduced by the Binance exchange. This index is used to analyze the performance of BNB, DOGE and MASK digital currencies. Bluebird Binance Index calculations, based on Weighted averages The current prices of the tokens in the Binance market are spot. In the BBI index, the USDT trading pair is used. In this article, in addition to the full introduction of this index, we will discuss how it works and how to use it.
What is meant by the blue board index?
The term bluebird or blue bird leads the minds of many digital currency users to the Twitter social network; However, the story is completely different. The Bluebird indicator is the newest indicator offered in Binance, which is designed for use in Binance futures trading. This indicator allows users to Permanent contracts or use without expiration date. The official date of presentation of BBI index is November 2, 2022. It is interesting to know that this indicator offers a maximum leverage of 25 for spot trading. This amount of leverage, although it may give you a high profit; But if the transaction is not successful, you will lose a lot.
History of the BBI index
The Bluebird index has a questionable and interesting history. The story of Bluebird started with Elon Musk’s big decision to buy Twitter. Shortly after this big purchase, news of CZ’s financial assistance, or Changpeng Zhao, the CEO of Binance, came to Elon Musk. It was reported in these news that Zhao helped Musk with nearly 500 million dollars to buy Twitter. Exactly one week after the publication of this news, Binance exchange unveiled the BlueBird index; For this reason, many users believe that these back-to-back events are not random and are completely related. Some also believe that presenting the Blue Board index will ultimately help the entry of NFTs and digital currencies into the world of social networks, including Twitter. Of course, at the moment, these statements are just speculations!
Formulas and calculations
The bluebird index is calculated using the following formula:
The parameters used in the above formula are:
- Number of main parameters (three variables including Mask, DOGE and BNB)
- Last price of variable i (in USDT)
- The last weight of variable i based on the last time t
Also, in the desired formula, the value is equal to:
Also, the weight of each variable at the last time t is also calculated based on the following equation:
Weighting factor or the weight factor in the above equation is calculated by the following method:
What is behind the selection of BNB, DOGE and MASK for Bluebird index?
According to the latest reports, the weight of BNB, DOGE and MASK tokens in the Binance BBI index is 51.81, 41.87 and 6.32%, respectively. With this account, BNB has the most weight. But the main question here is what is the connection between these cryptocurrencies and Bluebird Binance?
To answer this question, let’s examine each of these digital currencies together. The first token is DOGE, whose name is associated with Elon Musk. Dodge, or the famous dog of the digital currency market, was one of the original and humorous ideas of the cryptocurrency market. The price of Dodge has skyrocketed and become a valuable digital currency after Elon Musk’s massive support. The reason for this choice also seems natural for the BlueBird index.
The next token is BNB, the native cryptocurrency of the Binance network. This cryptocurrency, based on ERC-20 standard and was used as a method to reduce transaction fees in the Binance exchange. For this reason, there is a deep connection between BNB and the emerging index of this exchange. The price of Binance Coin is increasing due to the extensive activities of the popular Binance exchange.
MASK digital currency has a more interesting story than the other 2 cryptocurrencies. Mask is the native token of the MASK network, which was created for the purpose of transmitting encrypted messages on social networks such as Twitter. It is interesting to know that with the help of this decentralized protocol, you can buy DeFi tokens through exchanges. Sushi Swap (SushiSwap) and Uniswap (UniSwap) transfer easily.
The advantage of using a mask is that if you are working with Twitter, you don’t need to exit it; It is enough to transfer DiFi tokens with its help through one of the mentioned exchanges. The overall goal of the Mask Network is to move decentralized privacy applications to social media (Social Media) is. With these definitions, the connection between Musk’s network and Twitter remains speculative.
What is meant by permanent contracts in the BBI index?
To get familiar with the concept of permanent contract, we must first understand the term futures contract let’s get acquainted A futures contract is one of the types of contracts in the digital currency market, in which the parties agree to trade an asset or digital currency at a certain price in the future. Be careful that in these types of contracts, the settlement date will not change. Of course, the duration of the contract may vary.
With this definition, a permanent contract in futures is a type of futures contract that does not have an expiration date; For this reason, there is no need to redefine the position of purchase and sale of borrowing. According to the permanent contract, the price of the traded asset must depend on the price in the spot market.
How to use blueboard index?
To use the Binance Bluebird indicator, first log into the Binance exchange website. After entering the site, keep the mouse on the Derivatives option from the top menu of the site. From the drop-down list that opens, select USD-M Futures.
In the next step, a page will open where you have to select BluebirdUSDT from the available options.
You can transfer USDT holdings to USD-M Volts at this point.
In the final step, you can register your limit order. Note that the amount of the registered order should not be less than 0.6 Bluebird.
5 interesting facts about Bluebird index
In this section, we are going to discuss 5 interesting facts about the Bluebird index. However, with the passage of time, more facts will be revealed about this Binance indicator.
- Binance exchange has announced that this index has nothing to do with investing on Twitter.
- Some analysts believe that in the near future, a digital currency called Bluebird will be created.
- According to speculations, the prices of three digital currencies on Bluebird will increase in the future.
- After Musk joined Bluebird, it grew more than 200%.
- There is no such thing as blueboard price; This index only follows the price of the three cryptocurrencies in question.
What is the Bluebird Binance Index? Introducing the bluebird index or BBI for the first time on the Wallex blog. appeared.
