London-based Bitcoin (BTC) and Ripple (XRP) derivatives exchange Crypto Facilities today announced the launch of their new Instant Margining System (IMS) which will markedly improve the speed, stability, and user-friendliness of the trading platform.
There are some differences in the margin parameters of the new system, which are now only Initial Margin (IM) and Maintenance Margin (MM). If a portfolio value falls below Maintenance Margin, the position will be liquidated (or terminated if liquidation is not possible). Maintenance Margin is set at half of the Initial Margin, which remains at 2% for XBTUSD Futures and at 5% for XRPUSD and XRPXBT Futures.
The Instant Margining System (IMS) uses the two different margin parameters to manage the credit risk of margin accounts. Each parameter is associated with a certain margin requirement per open long or short position and triggers a certain action when reached:
|INITIAL MARGIN (IM)||This is the margin that is required to open new positions. If the portfolio value of a margin account falls below IM, all open orders that would further add to the risk of this margin account are canceled immediately. Before any new positions can be opened, additional funds must be deposited into the margin account to bring portfolio value back above IM. Alternatively, some existing positions can be closed out.|
|MAINTENANCE MARGIN (MM)||This is the margin that is required to maintain open positions. If the portfolio value of a margin account falls below MM, then the liquidation procedure begins.|
– Mark prices, margin, and PnL recalculate several times per second
– Indices calculate once per second based on the CME CF Methodology
– Effective leverage and return on equity (ROE) show on open positions tab
– Close position at market price in two clicks
– Detailed statistics upon any liquidation/termination sent via email
– Public trades history identifies liquidations (“L”) and terminations (“T”)