The new feature is now available on our app version 1.7.8! For iOS users, the app will be available for download after receiving the approval from Apple Store.
What is token margin trading?
Margin trading allows users to leverage more funds to maximize the potential return on spot trading.
What can we do with margin trading?
1. You can borrow tokens from OKX, executing positions with 3 times of your capital. Your potential return is therefore maximized, but so is your potential loss.
2. You can also short sell positions: to sell borrowed tokens and buy back after a period of time to earn the difference.
How to trade on margin?
1. Read and agree to the terms to enable margin trading.
Select "Leverage" in token trading. Then, read the terms carefully before you agree to enable the feature.
2. Transfer Funds from Your "Spot Account" to "Margin Account"
In your margin account, funds are segregated under different trading pairs. Select "transfer" of the trading pair you wish to trade to move funds into the account.
3. Borrow Tokens
Under "Tokens Trading", select "Leverage" to switch to leveraged mode. Then tap "Borrow" to continue.
Let’s say we are trading BTC/USDT: you can borrow BTC to short BTC; or borrow USDT to buy BTC.
5. Interest and repayment
Interest is incurred daily and can be repaid at any time. (repayment must be made in the token borrowed)
For repayment, select "repay" and enter the amount.
Interest Computation: Interests would be computed and incurred per each borrowing instruction. Interests would then be incurred once after the borrowed order is accepted and accrued per 24-hour intervals. Interests payable is compounded to next terms on each 15 days. (That is, unpaid interests expense would be computed as principal and thus incurring compounded interests)
Repayment: Repayments will be used to cover the earliest loan orders, and pay off interest before principal. The repayment status will change to completed once all the debts have been paid off, then further interest will not be applied for the order.
6. Forced Liquidation
As stated in OKX Token Lending Service User Agreement: "As a Token Lending Service user, by using the leverage tool, you agree to authorize OKX.com to perform risk management actions if your leverage account is at risk (user assets/debt≤110%), including but not limited to selling your positions"
Risk ratio is computed per each token.
User assets = principal + loan - interests
Debt = All "borrowed" assets
Risk ratio = user assets/debt
System will notify user via SMS when risk ratio = 130% and liquidate all positions when risk ratio = 110%.
For commonly used terms in margin trading, please see Leverage Trading Glossary.