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How Does “Tethering” Affect the Calculation of the FSP for a USD-denominated Crypto Future?

If the stablecoin used for settlement loses its US Dollar peg, the FSP becomes inaccurate in true USD value, introducing settlement risk.
Greeks.Live22.11.25

How Does “Tethering” Affect the Calculation of the FSP for a USD-denominated Crypto Future?

Tethering refers to the use of stablecoins like USDT, which are theoretically pegged to the US Dollar, as the settlement currency. If the stablecoin loses its peg (de-pegs), the calculated Final Settlement Price (FSP) for a USD-denominated future settled in that stablecoin will be inaccurate in terms of actual US Dollar value, introducing settlement risk for participants.

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