Loans and Interests
Leverage trading involves utilizing one's own capital to borrow additional funds for engaging in two-way transactions, thereby magnifying the scale of the capital involved. Profits can be generated by taking a long position through buying to capitalize on the rising prices of digital assets or by taking a short position through selling to benefit from the decline in digital asset prices. The highest permissible leverage is 10 times the original capital, allowing for a tenfold amplification of gains; however, conversely, losses can also be substantial. Borrowed funds accrue interest, and prudent risk management is essential when employing leverage trading.。
Trading Rules
After user registration and completion of KYC verification, trading and deposit/withdrawal permissions are granted. Upon depositing funds into the account, leverage trading privileges are obtained, subject to the condition that the available balance is greater than 0 for trading to occur.
When placing an order, the system defaults to selecting the margin borrowing mode. The maximum borrowable amount is automatically calculated based on the chosen leverage. If margin borrowing is enabled, the system also automatically evaluates the account balance. If the available balance is sufficient to trade the chosen asset, the system defaults to using the balance. If the balance is insufficient, the system automatically calculates the required borrowable amount. After order confirmation, a popup window displays actual borrowing data. Confirmation is required before a successful order placement. After the order is executed, the borrowed amount is displayed as a liability in the asset list. Interest rate information can be viewed through the interest rate link for each currency, and deduction data is synchronized with the trading records. Users can check specific deduction data through the transaction details in the trading account.
The available balance is the total balance of all currencies converted to USDT at market prices. For example, if a user has a balance of 5000 USDT and 1 BTC, with BTC priced at 30,000 USDT, the actual available balance when margin borrowing is selected would be 35,000 USDT. If margin borrowing is not selected, the actual available balance would be 5000 USDT.
In the trading area, users can select leverage, order price, and order quantity for buying (long) or selling (short). The chosen leverage affects the maximum borrowable amount. Given sufficient margin and without triggering limits, the maximum borrowable amount is the available margin balance multiplied by the leverage.
For example, if the current value of ETH is 2,000 USDT, the account holds 1 ETH, and the user decides to go long with 5x leverage, the maximum borrowable amount is 10,000 USDT. Buying 5 ETH results in a position with 6 ETH (including a margin balance of 1 ETH that is not used in trading) and a debt of 10,000 USDT.
If the user sells 2 ETH at a market price of 3,000 USDT, gaining 6,000 USDT, a manual repayment of 6,000 USDT is required, along with corresponding interest deduction. After repayment, the position consists of 4 ETH and a debt of 4,000 USDT. Once the debt is cleared, the position automatically disappears.
Risk Management Protocols
The higher the set leverage and the larger the borrowed amount, the more likely it is to trigger risk control.
When the margin ratio is < 300%, the system issues a margin call warning to the account, indicating the need to be aware of the risk of liquidation.
When the margin ratio is < 100%, the position triggers forced liquidation, canceling the opposite pending orders of your position. The portion or all of your position with isolated leverage will be transferred to the liquidation engine. The liquidation engine will follow certain rules to convert position assets into liabilities for debt repayment until the account is deemed safe.
Maintenance Margin | Maintenance margin =SUM(pending orders maintenance margin)+SUM(position maintenance margin)+SUM(loaned maintenance margin) |
Margin Rate | Margin Rate = Effective Equity/(Maintenance Margin+Liquidation Fee) |
Loan Regulations
The leverage trading feature effectively addresses your capital constraints, enhancing capital utilization. In leverage trading, the calculation of margin is involved, and each limit and market order generates occupied margin. When the total available margin in full position is greater than the occupied margin of the order, selecting the borrowing mode does not generate borrowing data. If the total available margin is less than the occupied margin, and the borrowing mode is not selected, the system notifies of insufficient available margin, preventing the order placement. When the available margin is less than the occupied margin, and the borrowing mode is selected, the system automatically calculates the borrowable amount and the quantity of coins that can be bought or sold based on the leverage selected, allowing the order to be successfully placed.
The maximum borrowable amount is calculated as the minimum of (available margin * leverage) and the lending limit for the specific cryptocurrency.
In leverage trading, with borrowing mode enabled, confirming borrowing data for pending orders is necessary. Unfilled orders can be canceled, but doing so incurs corresponding interest deduction for one hour. Borrowed funds need to be manually repaid to clear the debt.
Leverage Rule Calculation
Leverage Ratio Selection for Currencies: 3X
Currencies Supporting Leverage Trading: BTC/ETH/BNB/USDC/MATIC/SOL/LTC/SHIB/TRX/AVAX/LINK/ATOM/UNI/OKB
Margin Calculation:
Used Margin = Position Value / Leverage
Position Value = Coin Price * Quantity * Leverage Ratio
Available Margin = Effective Margin - Occupied Margin
Effective Margin = (Available Equity in Positive Full Positions for each currency * Spot USDT Price * Coin Conversion Rate) + (Available Equity in Negative Full Positions for each currency * Spot USDT Price) - Spot Sell Orders
Interest Calculation Rules
Leverage lending interest rates will change hourly based on market conditions. Interest accruals are computed using simple interest calculations and accumulate at the top of every hour.
If the borrowing period is less than 1 hour, interest for the entire hour is still applicable.
In the event of placing an order followed by its cancellation, corresponding borrowing interest for one hour will be deducted. Manual repayment of borrowed funds is required to clear the debt.
Interest Calculation Formula:
Interest = Borrowed Amount × Hourly Interest Rate × Borrowing Hours
Example：
Assuming an hourly interest rate of 0.001%, if a user borrows 1,000 USDT at 13:20 and repays it at 14:15, the interest calculation would be:
Interest = 1000 x 0.001
The user is charged interest for two hours; the period from 13:20 to 13:59 is considered one hour, and the period from 14:00 to 14:15 is considered another hour.
Market interest rates may fluctuate based on market conditions. It is advisable to monitor interest rates and risk factors to avoid liquidation due to the accumulation of interest over an extended period.
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