Exchange Trading Rules
Last updated: November 19, 2023
emergency maintenance (including unscheduled maintenance);
planned or unplanned system and software updates; and
due to any other event or occurrence that Backpack Exchange considers, in its sole discretion, to be a reason to suspend or shut down the operations on the Platform.
In addition to the actions that Backpack Exchange may undertake as provided under Rule 10.19, Users acknowledge and agree that Backpack Exchange reserves the right (without any liability resulting of Backpack Exchange or any Backpack Exchange affiliates involved in the provision of the Backpack Exchange services) to disable, update, cancel, restrict or otherwise modify any content, components or features of the Platform.
Interruptions
If technical reasons prevent or degrade Users’ ability to place or cancel Orders, or prevent or degrade access to Backpack Exchange APIs or the Platform or affect the operation of Order Books or matching engines, then Backpack Exchange may, in its own discretion, take one or more of the following actions in respect of one or more Order Books;
Temporarily disable depositing or withdrawing Assets.
Cancel Open Orders.
Disable the ability to place new Orders (Cancel-only Mode).
Disable Order Books altogether.
Disable sign-in.
Disable the Backpack Exchange APIs.
Disable access to the Site.
If access to the Platform is unavailable for 5 minutes or longer, Backpack Exchange may move the Platform to Cancel-Only Mode.
In the event that the Platform is in Cancel-only Mode, it will be restored to full operation once access through the Platform is available for at least 5 minutes and Backpack Exchange deems it is safe to restore the Platform to fully operational.
Backpack Exchange will notify Users of the move to or from Cancel-only Mode via @xNFT_Backpack on Twitter or at https://status.backpack.exchange.
Self-Trade Prevention
Users are not able to place an Order which would result in self-execution—i.e., where the same User would act as both the maker and taker for the trade.
If two Orders of the same quantity would result in self-execution, Users will have the option of either (a) canceling the Maker Order, (b) canceling the Taker Order, or (c) canceling both the Maker and Taker Orders.
Flash Crashes and Circuit Breakers
Backpack Exchange does not utilize circuit breakers or automated trading halts based on predetermined price thresholds. As provided in Rules 10.19 and 10.20, Backpack Exchange may, in its discretion, halt trading.
Prohibition of Market Manipulation
Users are prohibited from engaging in market manipulation.
Market manipulation of any kind is strictly prohibited. Market manipulation is defined as actions taken by any market participant or a person acting in concert with a participant which are intended to:
Deceive, mislead, or improperly take advantage of other Users or Backpack Exchange;
Artificially control or manipulate the price or trading volume of an Asset; or
Aid, abet, enable, finance, support, or endorse either of the above.
Market Manipulation specifically includes, without limitation: front-running, wash trading, spoofing, layering, churning, and quote stuffing.
Delisting of virtual assets and suspension of trading
Backpack Exchange reserves the right to delist a listed Virtual Asset or suspend trading in relation to a Virtual Asset if:
such delisting or suspension is required by a Competent Authority or has been approved by the VARA;
such delisting or suspension is required for Backpack Exchange to comply with Applicable Laws and Regulations;
such delisting or suspension is required to protect the fair and orderly operation of the Platform;
the relevant Virtual Asset exceeds or is likely to exceed any specific parameters published on the Platform, including where, in Backpack Exchange’s discretion, a Virtual Asset, is exhibiting unusual or excessive price volatility;
such delisting or suspension is required as a result of a hard fork affecting the relevant Virtual Asset; and
such delisting or suspension is required in connection with a Downtime.
Prohibited Conduct
Users are strictly prohibited from participating in, aiding, abetting, allowing, financing, supporting, or otherwise endorsing any behaviour involving market abuse, fraud or any conduct contrary to Backpack Exchange’s AML procedures including:
engaging in any conduct that is calculated to, or that creates a significant risk of, misleading the market including sharing, publishing, broadcasting or otherwise disseminating false or misleading information on Virtual Assets;
engaging in any conduct amounting to market manipulation, including the placing of any Order:
create or execute fictitious transactions or place any Order for a fictitious transaction with knowledge of its nature;
place any Order on the Platform which has been pre-arranged (or discussed with another market participant prior to being placed on the Platform) for the purpose of creating an artificial price, fictitious trade, or other disruptive, fraudulent, non-competitive, or unfair impact on the Platform;
to give or potentially give a false or misleading interpretation of the supply and/or demand for a Virtual Asset; and/or
creating an abnormal or artificial price.
engaging in any conduct that is calculated to create, or creates, a significant risk of, overloading or otherwise impairing the operation of the Platform.
Each User acknowledges and agrees that if any such techniques or activities are detected (or are reasonably suspected) by Backpack Exchange then any User found or reasonably suspected by Backpack Exchange to have participated, aided, abetted, allowed, financed, supported or otherwise endorsed any behaviour will be subject to disciplinary action in accordance with these Rules.
The User shall not engage in any trading, practice, or conduct on the Platform that:
demonstrate an intentional or reckless disregard for the orderly Execution of transactions; or
is, of the character of, or is commonly known as “spoofing” (bidding or offering with the intent to cancel the bid or offer before execution).
Default rules and disciplinary actions
Backpack Exchange defines a Default Event as any one of the following:
material failure by a User to meet any of its obligations under the User Agreement, these Rules, undertakings given by the User or any other agreement between the User and Backpack Exchange;
material breach of these Rules or the User Agreement by a User;
material misrepresentations made by a User;
User is declared bankrupt or seeks a voluntary arrangement in respect of its debts;
User engages in or attempts to engage in any form of Market Abuse; or
an event of an enforcement proceeding, sanction, formal notification or injunction against the User by a Competent Authority.
Backpack Exchange may, at its absolute discretion, declare the relevant User as a ‘Defaulter’ on the occurrence of a Default Event. Declaration of a User as a Defaulter shall be made by email to the Defaulter.
Upon declaring a User as a Defaulter, Backpack Exchange may initiate, taking into account the severity of the Default Event, inter-alia, any of the following disciplinary actions:
Issuing a written warning to the Defaulter;
requiring the Defaulter, via a notice, to provide any information or document within a specified time to assist Backpack Exchange in its investigation of the Default Event;
requiring the Defaulter, via a written notice, to remedy the Default Event, where possible or desirable by Backpack Exchange in its sole discretion, within the time it specifies;
canceling some or all Orders or transactions of the Defaulter;
selling some or all of Defaulter’s Virtual Assets to the credit of the Defaulter's Account;
suspending or terminating the Defaulter’s access to the Platform; and
blocking the Defaulter’s access to their Accounts.
Backpack Exchange reserves the right to report any Default Event and any disciplinary action taken by Backpack Exchange in respect of any such Default Event to the relevant Competent Authorities. Backpack Exchange will not, and has no obligation to, notify a User before reporting any Default Event to any of the Competent Authorities.
Penalties
In the event of a violation of any of these Rules, the User shall be subject to penalties as determined by Backpack Exchange.
The penalties for the violation of these Rules may include but are not limited to, fines, suspension or termination of the User's account, or any other action deemed appropriate by Backpack Exchange.
The User acknowledges and agrees that Backpack Exchange may, at its sole discretion, modify the penalties for the violation of these Rules from time to time.
The User shall be notified of any changes to the penalties for Rules violations, as and when they occur.
Access to Information
All Users have full and equal real-time access to Backpack Exchange’s market data (“Market Data”). Market Data is made available through the Platform.
Market Data comprises the following:
All Limit Orders placed on the Order Book (price, quantity, and time).
All Fills or Executions (price, quantity, and time).
Market Data does not include the following:
All canceled Orders on the Order Book (price, quantity, and time).
Resting Stop Orders (Stop Orders that have been placed but not triggered).
Any information about which User placed or canceled an order.
Backpack Exchange Corporate Operations
Backpack Exchange itself does not engage in any trading activities on the Platform. Backpack Exchange operates as an intermediary, allowing Users to interact with each other to Execute trades on the Platform. This ensures that the trading activities on the Platform are conducted independently by the Users without any influence or bias from Backpack Exchange.
Backpack Exchange Employee Access
Backpack Exchange policies prohibit all Backpack Exchange employees from using inside, corporate, or proprietary information to trade Virtual Assets on the Platform.
Downtime
From time to time, Backpack Exchange may suspend trading temporarily for maintenance or upgrades. Backpack Exchange will endeavor to follow the following process for closing and re-opening trading, when appropriate:
Step 1: Announce Downtime
Announce scheduled Downtime via status.backpack.exchange, or Twitter
For scheduled Downtime, Backpack Exchange will endeavor to announce at least ten (10) days prior to the start of the scheduled Downtime.
For unscheduled Downtime, Backpack Exchange will endeavor to provide as much prior notice as possible
Step 2: Downtime BeginsStep 3: Immediately after Downtime is Completed
All books enter the 'Post-only' Mode
Announce the above via status.backpack.exchange
To ensure a fair and orderly marketplace, Backpack Exchange may in its discretion cancel all resting Limit Orders in an Order Book before moving the market to Post-only Mode or to Limit-only Mode
Step 4: At least 1 minute after Step 3; or longer duration if necessary
All books enter Limit-Only Mode
Announce the above via status.backpack.exchange or Twitter
Step 5: At least 10 minutes after Step 4; or longer if necessary
All books enter into full-trading Mode
Announce the above via backpack.exchange
Amendment
Backpack Exchange may from time to time amend these Rules by publishing an updated Rules on backpack.exchange at least fifteen (15) days prior to the effective date of such amended Rules.
Custody and safekeeping arrangements
Title and control
The ownership of fiat currency and Virtual Assets held by Users shall remain with them at all times. Users bear the risk of any loss incurred as the owner of such assets. It should be noted that none of the fiat currency and Virtual Assets held in a User's Account are the property of Backpack Exchange.
Users shall have full control over the fiat currency and Virtual Assets held in their Account. They may withdraw their assets at any time, subject to Downtimes and other restrictions under these Rules and other applicable policies.
User Virtual Assets
A User's Virtual Assets, to the credit of such User's Account, shall be held by Backpack Exchange, on behalf of the User, in a User Virtual Asset wallet segregated from Backpack Exchange’s proprietary assets at all times.
Any Virtual Asset received by Backpack Exchange from Users will be received and securely stored by Backpack Exchange or the Custodian. Backpack Exchange will be the sole custodian of the private keys.
Backpack Exchange does not provide any interest on the Virtual Assets held on behalf of Users.
Users’ Virtual Assets shall be pooled into an omnibus wallet. While the Virtual Assets belonging to different Users are not physically segregated, they shall remain segregated from Backpack Exchange’s proprietary Virtual Assets.
Backpack Exchange will perform a daily reconciliation of the Virtual Assets held by Backpack Exchange on the User’s behalf. Users shall have the option to access their Virtual Asset balances by logging into their Account for their Virtual Assets.
Fiat currency
Backpack Exchange does not currently provide fiat currency services to its customers.
Complaints
Any person may lodge a complaint with Backpack Exchange in accordance with Backpack Exchange’s Complaints Handling Policy, in relation to any aspect of Backpack Exchange’s operation of the Platform. Backpack Exchange will address such complaints in accordance with the Complaints Handling Policy, which is published on the Platform.
Definitions
In these Trading Rules, the following words and phrases have the corresponding meanings.
Account means an account held with Backpack Exchange in the name of the User on the Platform.
Applicable Laws and Regulations means provisions of laws, statutes, ordinances, rules, regulations, permits, certificates, judgments, decisions, decrees or orders of any Competent Authority applicable to Backpack Exchange or the Users.
Available Balance means a User’s Total Asset Value less any amounts held for Open Orders and fees.
Base Asset means the Asset being traded on the Order Book; the first Asset in the Trading Pair. For example, on the BTC-USD Order Book, BTC is the Base Asset and USD is the Quote Asset.
Cancel-only Mode means that Users cannot place new Orders. Users are able to cancel open Orders. No Orders will be Filled.
Competent Authority means VARA and any other regulatory, judicial or law enforcement authority that has jurisdiction over the activities of Backpack Exchange, the Platform, or the Users.
Default Event shall have the same meaning as defined in Rule 13 of these Rules.
Fill or Execution means matching of two Orders.
Full-Trading Mode means normal operation of the Backpack Exchange Platform. Users can place Market Orders and Limit Orders and can cancel Orders.
Hold means the setting aside of Assets allocated to an Order.
Limit Order means an Order to buy or sell a specified quantity of an Asset at a specified price.
Limit-only Mode means that Users can place and cancel only Limit Orders. Only Limit Orders can be Filled during this mode. Market Orders will be rejected.
Market Order means an Order to buy or sell a specified quantity of an Asset at the best available price of existing Orders on the Order Book.
Order means an instruction to buy or sell a specified quantity of the Base Asset at a specified price in the Quote Asset.
Order Book(s) means each Order Book on which Orders are placed for trading in a Trading Pair.
Open Order means a Maker Order which has been posted but not Filled, canceled or expired, or a Stop Order which is currently active.
Post-only Mode means that Users can only place an Order if it would be posted to the Order Book as a Maker Order. An Order which would be posted as a Taker Order will be rejected. No Market Orders may be placed and no Orders will be Filled. Resting orders may be canceled in post-only mode.
Quote Asset means the Asset which is used as the denomination in trading on the Order Book and is also the second Asset in the Trading Pair. For example, on the BTC-USD Order Book, BTC is the Base Asset and USD is the Quote Asset.
Scheduled Downtime means a planned temporary outage for maintenance or upgrades. See section 4.
Stop Order means an instruction to post an Order to buy or sell a specified quantity of an Asset but only if and when the last trade price on the Order Book equals or surpasses the Stop Price.
Stop Price means the price specified in a Stop Order.
Total Asset Value means the gross value of all of a User’s Assets for the relevant Order Book, expressed in the Quote Asset based on the last trade price. This includes all Assets allocated to Open Orders.
Trading Pair means each pair of a Base Asset and a Quote Asset offered on the Backpack Exchange Platform.
User refers to any person (including individuals or legal persons) that access, download or use the Platform or any services of Backpack Exchange, and who meet the eligibility criteria specified by Backpack Exchange.
Virtual Asset means a digital representation of value that may be digitally traded, transferred, or used as an exchange or payment tool, or for investment purposes. This includes Virtual Tokens, and any digital representation of any other value as determined by VARA.
Virtual Token means a digital representation of a set of rights that can be digitally offered and traded through a Virtual Asset platform.
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