One-stop shop solution empowers crypto traders to optimize their capital utilization

The volatility within crypto markets calls for risk management tools; the available options lack efficient tools to manage it.

The war among crypto exchanges is not just a war of altcoin listing, it is also a war of technology innovation. 

Better matching engine, shorter latency, larger TPS, more rate limit, smarter order types, no downtime, the list goes on. Especially, traders are insatiable about capital efficiency when trading crypto, whether it is spot or derivatives trading. 

Technology advancement is, once you try the new thing, there is no going back. When your capital can be utilized 200% all the time, 101% is not acceptable. Starting from 2021, leading crypto exchanges have been offering advanced collateral management products, which increased the market turnover drastically. 

One such product is Unified Margin (UM) by bit.com, which comprises a full package of an enhanced trading and risk management system that assists users in managing the assets they’ve collateralized for trade. 

According to bit.com CEO John Ge, the platform will help users manage their investments better. 

“Given market volatility, managing profits and loss positions with high efficacy is paramount. A Unified Margin account coupled with our Portfolio Margin Model allows our users to benefit from an industry-leading risk management system with optimized capital utilization,” he added. 

Unified Margin offers several advantages to its users compared to the existing players in the market. 

First, it streamlines user accounts. It is a one-stop shop where users can trade different investment products from a single account. These products include spot, options, futures, leveraged and perpetual trading. This means there will be no more moving funds from spot to derivatives account or vice versa. 

Second, the platform’s users share collateralized currency in its unified account as margin, improving their capital utilization. Users can also trade spots and derivatives in several currencies simultaneously without needing to move funds across several accounts and exchanges. For example, users can buy Solana (SOL) with Dogecoin (DOGE) balance in the account, even if there is no such trading pair on the platform.

Third, it optimizes the utilization of capital. The tool provides haircut ratios for all margins (as they’re all USDT-based). It also pegs the risk assessment on the margin’s Tether (USDT) value. The platform also consolidates both profit and loss positions and offsets them against each other. Thus, a loss in a position doesn’t spark forced liquidation if there is another open position in a profit. 

Last but not least, Unified Margin enhances borrowing. It uses one currency for margin trading while enabling the settlement of spot and derivative trades in any currency. If there’s a sufficient USDT balance, the platform will accept the trading of currencies or derivatives even if the chosen currency’s balance is insufficient.