The war between crypto exchanges is not only an altcoin listing war, it is also a technological innovation war.
Better matching engine, lower latency, higher TPS, no more rate limit, smarter command types, no downtime, the list goes on. In particular, traders are insatiable about capital efficiency when trading crypto, be it spot trading or derivatives.
Technological advancement is that once you have tried the new thing, there is no turning back. When your capital can be used at 200% all the time, 101% is not acceptable. As of 2021, major crypto exchanges are offering advanced collateral management products, which has significantly increased market turnover.
One such product is Unified Margin (UM) from bit.com, which includes a comprehensive set of enhanced trading and risk management system that helps users manage the assets they have secured for trading.
According to John Ge, CEO of bit.com, the platform will help users better manage their investments.
“Given the volatility of the market, managing profit and loss positions with high efficiency is paramount. A unified margin account combined with our portfolio margin model allows our users to benefit from a cutting-edge risks with optimized use of capital,” he added.
Unified Margin offers several advantages to its users compared to 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 that there will be no further transfer of funds from the cash account to the derivatives account or vice versa.
Second, users of the platform share the collateral currency in its unified account as margin, thereby improving their capital utilization. Users can also trade spots and derivatives in multiple currencies simultaneously without having to move funds across multiple 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 use of capital. The tool provides haircut ratios for all margins (because they are all based on USDT). It also ties the risk rating to the Tether (USDT) value of the margin. The platform also consolidates profit and loss positions and offsets them against each other. Thus, a loss in one position does not trigger a forced liquidation if there is another open position in a profit.
Last but not least, Unified Margin improves borrowing. It uses one currency for margin trading while allowing spot and derivative trades to be settled in any currency. If the balance in USDT is sufficient, the platform will accept forex or derivatives trading even if the balance of the chosen currency is insufficient.
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