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Collateral currency
A collateral currency is a currency that can be used for trading using margin*.
The collateral currency you hold does not have to match the trading pair of the order book on which you plan to trade using margin. This is possible because when you open a position by purchasing or selling cryptocurrency on margin (going “long” or “short”), Kraken’s own funds are used to extend margin to you for the full amount of that purchase or sale.
Unstaked assets can be used as collateral for margin trading. Kraken Rewards assets (staked automatically) are eligible as collateral, while Kraken Pro Flexible Staking and Pro Bonded Staking assets are not eligible.

The collateral currencies on Kraken are:

CurrencySymbolHaircut
Avalanche
AVAX
50%
Bitcoin
BTC
0%
Cardano
ADA
10%
Chainlink
LINK
30%
Cosmos
ATOM
30%
Dai
DAI
10%
Decentraland
MANA
30%
Ethereum
ETH
0%
Litecoin
LTC
30%
Polkadot
DOT
10%
Polygon
MATIC
30%
Solana
SOL
10%
Tether
USDT
10%
Tezos
XTZ
50%
TRON
TRX
50%
USD Coin
USDC 
0%

The collateral cash currencies on Kraken are:

CurrencySymbolHaircut
Australian Dollar
AUD
0%
British Pound
GBP 
0%
Canadian Dollar
CAD
0%
Euro
EUR
0%
Japanese Yen
JPY
0%
Swiss Franc
CHF
0%
US Dollar
USD
0%
For Cardano (ADA), Dai (DAI), Polkadot (DOT), Solana (SOL) and Tether (USDT) there is a 10% haircut, meaning for collateral currency purposes 1 USDT counts for 0.9 USDT towards your trade balance.
For Chainlink (LINK), Cosmos (ATOM), Decentraland (MANA), Litecoin (LTC) and Polygon (MATIC) there is a 30% haircut, meaning for collateral currency purposes 1 LINK counts for 0.7 LINK towards your trade balance.
For Avalanche (AVAX), Tezos (XTZ) and TRON (TRX) there is a 50% haircut, meaning for collateral currency purposes 1 XTZ only counts for 0.5 XTZ towards your trade balance.
Note: Collateral currencies used to open a spot position on margin can not be exchanged for other currencies or withdrawn while the spot position on margin is open. This means that, although your digital assets that are reserved as collateral currencies will show in your account balance, these assets will not be available to trade or withdraw. To see the amount available to trade or withdraw in any given asset, navigate to the Funding tab through your Kraken account, then click on Withdraw next to the specific asset.

Kraken Futures

Kraken Futures supports different collateral currencies and has a distinct margining system depending on the contract. See Futures Collateral Currencies for detail.