What is Margin Funding?
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The risks are low due to the design of our underlying bitfinex lending engine. We have taken the following steps to prevent funding providers from losing money: If a margin trader's position is at a loss, he will cover the loss with funds in his margin trading wallet. The funds bitfinex lending the margin trading wallet serve as collateral.
The position will be force-liquidated: Note that these numbers will vary a bit due to fees and interest bitfinex lending. In theory, these measures could still cause margin traders to lose more than the funds they hold in bitfinex lending account as bitfinex lending. Up to a certain point, we will cover the losses from our own reserves; however, if the price would change so dramatically that the majority of all margin positions would drop below zero, losses eventually will be shared with margin funding providers.
This has never happened in the existence of our platform, but in theory, it bitfinex lending happen. Providing liquidity in margin funding is not risk-free; however, interest rates are typically far higher than you achievable at through a typical savings account.
In the end, it's up to the user bitfinex lending weigh this risk and gains. Bitfinex Knowledge Base Margin Funding. Articles in this section What is Margin Funding? What bitfinex lending the difference between offering funding on a "daily" or "term" basis?
What is the minimum amount for offering funding? How are interest and fees calculated when offering margin funding? What are the risks associated with offering funding? How is the return on offered funding calculated?
When do I receive my return payment? What is the "Flash Return Rate"? What is the "FRR Delta? See more The risks are low due to the design of our underlying risk-limiting engine. If a trader's position is at a loss, he will cover the loss with funds in his Margin Wallet. The funds in the Margin Wallet serve as collateral only. A trader's position is force liquidated when the net value of his account falls below the maintenance margin.