Multi-Collateral Linear Futures
The Multi-Collateral wallet allows traders the flexibility to deposit a variety of collateral currencies to back their positions. Neither base nor the quote currency is needed as collateral to trade and all collaterals are valued in USD for margining under a single wallet with cross or isolated margin.
Haircuts and conversion fees apply to non-USD collateral currencies.
The following collateral currencies are supported:
|Collateral Asset||Ticker||Haircut||Conversion Fee|
Interest and auto-conversions can apply to unrealised losses uncovered by USD, depending on the value of the loss. See Fees for Multi-Collateral Futures for more information.
What is a haircut? When does it apply?
A haircut is a reduction in the value of a collateral asset that may be used as margin.
This applies to both non-USD funds in the margin wallet as well as non-USD unrealised Profit/Loss and funding (See Unrealized as Margin).
Haircuts only apply to collateral for Multi-Collateral contracts.
A trader has 0.5 BTC in their multi-collateral wallet and the current bitcoin-dollar index price is 35,000.
The balance value of this is 17,500 USD.
The haircut rate for BTC is 4%, meaning for collateral currency purposes this 0.5 BTC counts for 16,800 USD towards their multi-collateral margin.
This 16,800 USD equivalent is what can be used for collateral to back new orders and positions.
Balance Value (Asset Balance * Index Value)
(0.5 BTC * 35,000) = 17,500 USD
Collateral Value (Amount in collateral asset * index value) * (1 - haircut rate)
(0.5 BTC * 35,000) * (1 - 0.04) = 16,800 USD
Single-Collateral Inverse Futures
Single-Collateral Inverse contracts* only allow the base currency of the pair to be used as collateral.
Each collateral currency has a separate wallet and each wallet's collateral supports trading of both perpetual and fixed maturity contracts.
e.g. if trading a BTC/USD contract, the only collateral allowed would be BTC.
*Only available on legacy UI