CROSS exchange Margin Trading is the margin trading of cryptocurrency where users can borrow several times their deposited funds from the exchange and can perform transactions larger than their own with their margin account.
Margin Trading is not the same as FX.
Although there is FX that has similar characteristics in leveraged trading, margin trading is different from FX. FX involves trading cryptocurrency from an index, different from trading a created index from the spot price.
In that regard, margin trading borrows actual cryptocurrency (coins) and trades on the same trading board as spot trading, so it is possible to trade at a reasonable price backed by the spot price.
How Margin Trading works
So what is leveraged trading with margin trading?
Users who want to margin trade provide a deposit (collateral) into their margin account. With that as collateral, users can borrow real coins from CROSS exchange.
For example, suppose you own $10,000. With standard trading you can only trade with that $10,000. (Self-funded: $10,000, Tradeable: $10,000)
However for example, if margin trading is performed with a leverage of 6 times, you can borrow up to $60,000 in coins from CROSS exchange by depositing $10,000 as collateral. (Self-financing: $10,000, total trading amount possible: $60,000)
In that case, you will be charged a coin borrowing fee and transaction fee. (transaction fees can be reduced with XEX)
The reason why margin trading allows “open sales = short sales” is because the user already has coins borrowed from the exchange.
・Margin Trading is a service allowing the borrowing of real coins for trading
・Cryptocurrency FX is a service that trades indices, not the real product
・Both FX and margin trading must be traded (settled) and profit (or loss) must be confirmed