Smart Cross Margin Enhancements on the Exchange

Smart Cross Margin calculations will be changed to improve your trading experience

Oct 17, 2023
New Perps 1 1

We are excited to announce that several enhancements to Smart Cross Margin on the Exchange will be made to further improve your trading experience. These changes will be effective from 30 October 2023, 08:00 UTC onwards.

A summary of the enhancements are as follows:

  1. Increased Capital Efficiency

Negative USD balances will no longer incur Initial Margin or Maintenance Margin requirements, enhancing your capital efficiency on USD exposure. However, please note that negative USD balances will continue to incur interest charges.

  1. Higher Liquidation Buffers

We’re introducing a Minimum Haircut Rate, which will replace the current Maximum Collateral Weight calculation. Unlike before, the haircut will not be deducted from your Margin Balance. However, it will be added to your Margin Requirement. This provides you with a more substantial buffer before any position liquidation.

  1. Optimised Margin Requirements

The Maximum Account Leverage will no longer influence your Margin or Maintenance Margin requirements. Liquidations will now be determined by your risk profile rather than your risk appetite. This allows you to manage your account leverage without facing excessive margin requirements.

The changes do not cause any material impact to your current positions and Wallet health.

For a comprehensive list of changes, accompanied by illustrated examples, please refer to this document.

After these changes are implemented, please check the Exchange’s Smart Cross Margin Rule page for full details on the updated Margin and Derivatives risk parameters.

What is Smart Cross Margin?

Smart Cross Margin (SCM) is an advanced trading mechanism that offers traders the ability to offset margin requirements for positions in opposite directions (e.g., long vs. short) and across various product types, such as Spot, Margin, Futures, and Perpetual Futures. Smart Cross Margin enhances capital efficiency by potentially reducing overall margin requirements. This means traders can benefit from increased liquidity and flexibility in their portfolios.

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