Margin Trading provides the opportunity to trade the borrowed assets. This means that our clients now can open Long and Short positions on a variety of cryptocurrencies by up to 10x leverage. Those who use Margin Trading can amplify their potential profit depending on the selected leverage for 29 markets.
Margin accounts offer flexibility to investors, who use the strategy to take advantage of market opportunities by borrowing money from their brokerage firms to buy stocks that they may otherwise not be able to afford.
Margin trading feature provides a trader with the opportunity to increase their profit by using funds borrowed from the central counterparty (the broker). To borrow funds, the trader must pledge a margin expressed in the quote currency. All margin trading operations involve only the funds reserved on the trading account. The trader can place margin buy orders or sell funds valued in the currency reserved for a particular instrument.
Buy and sell margin orders for a particular symbol form a position. Orders of the direction, which prevails, are assumed as open orders. They are matched with opposite (close) orders. When all orders are evenly balanced, the position is closed and the trader can retrieve a positive PnL.
The trading platform monitors assets market prices to ascertain that the trader will be able to redeem borrowed funds. If a new trade potentially leads to a loss, one of the following outcomes is possible:
- the platform regularly sends to the trader a margin call inviting them to:
- replenish the margin;
- close the position for market prices
- the platform cancels open orders to partially restore the margin;
- the platform forcefully closes the position and withhold all margin available.
The central counterparty regularly charges a fee for providing funds according to a set of fee rates.
Enjoy up to 10x leverage on:
BCH/USDT, BTC/USDT, ETH/USDT, XRP/USDT, ETH/BTC, BCH/BTC, XRP/BTC, TRX/USDT, LTC/USDT, EOS/USDT, XMR/USDT, ETC/USDT, ADA/USDT, TRX/BTC, LTC/BTC, ETC/BTC, ADA/BTC, XMR/BTC, EOS/BTC
Up to 5x leverage on:
ZEC/USDT, DASH/USDT, VET/USDT, DOGE/ USDT, XLM/USDT, ZEC/BTC, DASH/BTC, XLM/BTC, DOGE/ BTC, VET/BTC
How does margin trading work?
Let us illustrate the idea of Margin Trading with an example. Assume that the price of Bitcoin Cash (BCH) is equal to USDT 1,000 and a trader thinks that it will rise in the future. However, the trader has only USDT 100 and he or she wants to amplify potential gains. The trader can use the maximum 10x leverage provided by Bitcoin.com Exchange to open a USDT 1,000 long position (trader’s USDT 100 was multiplied to 10). Now let’s assume that during the next few hours the price of Bitcoin Cash rocketed by 10% to USDT 1,100. The trader decides to close this profitable position and realizes a positive PnL of nearly USDT 100 (you need to take into account the fees and paid Interest Rate – see The Fee Page). If the trader opened this position without the leverage he or she will get only USDT 10 gain, because the position’s value would be equal to the trader’s balance of USDT 100.
Who can use Margin Trading?
Margin trading is available to a trader only if they:
- enabled 2FA;
- have a non-zero trading balance.
How to use Margin Trading?
Adding assets to your Margin Account
Please note that the collateral will be temporarily frozen and it couldn’t be used for trading.
- Transfer necessary assets to the Trading Account, then click “Margin.”
- Click the “Margin” button on the top right.
- Then a new window will appear. Enter the amount of collateral that will be reserved on your balance and click “Transfer”.
- Now your Buying Power has multiplied by 10 (or by 5 for several pairs). Here presented the example, where USDT X was borrowed from Bitcoin.com Exchange, with collateral of X USDT.
- You can add more margin at any time if needed
Trading on margin
Placing an order during Margin Trading is the same as on the spot markets. Traders can use Market order, Limit orders (Good-Till-Cancelled, Immediate-Or-Cancel, Fill-Or-Kill, Day, Good-Till-Date/Time), and Scaled order. The following links can help you learn more about Market order, Limit orders, and Scaled order. Buying Power is the total amount of assets that can be used to open a position. Please note that your margin position is zero before the first margin order is executed. Traders can cancel an order with zero margins at any time without paying any charges.
How to change the amount of collateral?
Traders can transfer back their funds from margin at any moment. However, you can’t transfer the Required Margin if you have an open position, because it operates as collateral and it maintains your current position open. However, you can retrieve part of the margin.
- To retrieve the margin, click “Margin”
- Enter the desired amount and click “Transfer”. Your funds will be instantly transferred to your Trading Account.
Dear users of Bitcoin.com Exchange please consider that Margin Trading has several risks due to cryptocurrency price volatility and product complexity. We advise you to exercise carefulness and attention. Bitcoin.com provides high liquidity, 24/7 multilingual support, and dozens of trading pairs complemented by high security, but we are not responsible for your financial losses during trading activities.