At Crypto Facilities we use Initial Margin (IM) and Maintenance Margin (MM) to manage the credit risk arising from open positions.
The larger a trader's position, the more liquidity is required to unwind that position in the event of an adverse price move. Additionally, the more volatile a currency pair, the higher the margin that is required to withstand typical price moves. IM and MM are therefore a function of both, contract type and of position size, as shown in the following table:
Position Limits (# Contracts) per Maturity
|Level I||Level II||Level III||Maximum||Status|
|Bitcoin-Dollar Futures||0-500,000||500,000-1,000,000||>1,000,000||3,000,000 (2,000,000 for Quarter))||Active|
|Ether-Dollar Futures||0-250,000||250,000-500,000||>500,000||2,000,000 (1,500,000 for Quarter)||Active|
|Litecoin-Dollar Futures||0-250,000||250,000-500,000||>500,000||2,000,000 (1,500,000 for Quarter)||Active|
|Ripple-Dollar Futures||0-250,000||250,000-500,000||>500,000||2,000,000 (1,500,000 for Quarter)||Active|
|Ripple-Bitcoin Futures||0-250,000||250,000-500,000||>500,000||1,500,000 (1,000,000 for Quarter)||Active|
|Margin Parameters for Professional Clients|
|Margin Parameters for Retail Clients|
***Due to anticipated stressed market conditions, these parameters have temporarily been set more conservatively to provide an orderly market. For ALL users the initial margin requirement is set to 10% with maintenance margin set to 2%. Note also max position of 250,000
Note: Margin percentages are based on the value of the collateral currency at entry price. Margin requirements and maximum position size are calculated for each instrument individually per maturity.
Example for Professional Client: You are long 1,000,000 contracts in the Perpetual Bitcoin-Dollar Futures and 250,000 contracts in the Monthly Bitcoin-Dollar Futures. Your IM requirement for the position in the Weekly will be 2% for the first 500,000 contracts and 4% for the second 500,000 contracts, resulting in an average IM of 3%. Your IM requirement for the position in the Monthly will be 2%.