In the UM mode, you can choose [non-borrowing mode] or [borrowing mode] for trading.
If you only want to trade with your available balance and do not want to incur liability or interest, you can toggle on [non-borrowing mode] in the setup.
If you want to trade a currency and its derivatives even if your available balance of the currency is insufficient,you can select [borrowing mode] in the setup.
Non-borrowing mode | Borrowing mode | |
You can trade | Spot (Not supporting overselling)
Perpetual (Not supporting opening positions by borrowing)
Futures (Not supporting opening positions by borrowing)
Options (Not supporting opening positions by borrowing) | Spot/margin (Supporting overselling)
Perpetual (Supporting opening positions by borrowing)
Futures (Supporting opening positions by borrowing)
Options (Supporting opening positions by borrowing) |
Borrowing occurs when | 1. Losses incurred on positions in a currency resulting in currency liabilities | 1. Overselling a currency
2. Opening a position when the available balance of the settlement currency is insufficient
3. Losses incurred on positions in a currency resulting in currency liabilities |
Auto repayment occurs when | The liability of a currency exceeds the interest-free amount. | The liability of a currency exceeds the borrowing limit. |
Interest charging rules | No interest | No interest will be charged if the liability is within the interest-free amount. If the liability exceeds the interest-free amount, interest will be charged on the full amount of liability. |
1. Non-borrowing mode
When a user turns on the non-borrowing mode, the user can only place spot or derivatives orders using the available balance in that currency.
In the non-borrowing mode, position losses of derivatives due to market fluctuations may result in liability. If the amount of liability is within the interest-free amount offered by BIT, no interest will be charged. If the amount of liability exceeds the interest-free amount, the system will trigger the auto repayment process. For a description of auto repayment rules, please read the auto repayment section.
2. Borrowing mode
When a user turns on the borrowing mode, as long as the user’s USD total available balance is sufficient, the user can sell a currency or trade its derivatives even if the available balance of the settlement currency is insufficient.
For each currency, if the equity falls below the sum of the initial margin and frozen amount, the shortfall is the potential liability. Short spot initial margin and maintenance margin are charged on potential liabilities, and their USD equivalent amounts are added to the respective USD total margin amount.
When a user's trades or position losses cause the currency’s equity below zero, the negative amount is liability. If the liability amount is within the interest-free amount, no interest will be charged; if the liability amount exceeds the interest-free amount, BIT will charge interest based on the full amount of liability in that currency. If the liability amount exceeds the borrowing limit of the currency, the system will trigger auto repayment to repay the liability.
Learn more about liability and interest charging rules under borrowing mode