Understanding and Trading Coin-Margined Futures

CoinCatch offers a diverse range of crypto derivatives with over 120 trading pairs and two types of futures contracts: COIN-margined and USDT-margined contracts. These options cater to traders on the leading crypto futures exchange. We will delve into COIN-Margined futures and how they work below.

 

Understanding COIN-Margined Contracts

COIN-Margined contracts enable users to hold the actual cryptocurrency instead of stablecoins like USDT. This is particularly advantageous for long-term investors, especially during bullish trends.

 

In essence, COIN-Margined contracts offer a strategic way to increase cryptocurrency holdings over time. HODLers can take advantage of COIN-Margined contracts to grow their portfolios because these are settled in the underlying cryptocurrency.

 

For instance, Bitcoin-Margined contracts yield profits in BTC, making them preferable during uptrends. Not only can traders benefit from profitable trades, but rising prices also increase the value of their collateral. Moreover, COIN-Margined contracts can serve as a hedge for HODLers in bearish markets, as they don't require selling cryptocurrencies at compromised prices. Profits from COIN-Margined trades can offset losses in the portfolio when the underlying asset's price declines.

 

1. Margin and Leverage

Futures are a financial instrument that use leverage to magnify profit, and where traders don't need to allocate 100% of the funds. They invest a small amount as collateral based on the futures value, referred to as margin.

 

Leverage enhances fund utilization, but it comes with higher risks. The higher the leverage used by the trader, the lower the required margin.

 

2. Supported Margin Currencies

Perpetual Coin-Margined Futures allow the use of platform-supported currencies as margin. These margin currencies are applied for profit and loss settlement.

 

Coin	Trading Pair Supported
BTC	BTCUSD
ETH	ETHUSD
XRP	XRPUSD

 

 

3. Funding Fee

The funding fee is a crucial mechanism in CoinCatch Coin-Margined Futures, aiming to align the futures' transaction price with the underlying asset's reference price. This is achieved through regular fund rate exchanges between long and short positions.

 

CoinCatch doesn't charge any funding fees, as these fees are exchanged peer-to-peer among CoinCatch users. Learn more about CoinCatch Coin-Margined Futures Fund Fee here.

 

4. Perpetual Coin-Margined Futures

These futures have no expiration or settlement dates, utilizing platform-supported currencies as margin. Profit and loss calculations are based on the chosen margin currency, with the spot price anchored through funding rate swaps.

 

How to Trade Coin-Margined Futures on CoinCatch?

1. Go to CoinCatch Coin-Margined Futures trading page

Log in with your CoinCatch account and password, then go to the Coin-Margined Futures trading page.

 

2. Transfer funds to your Futures account

Use the "Transfer" function to transfer assets from your Spot account to your Coin-Margined Futures account. There is no fee for internal transfers.

 

3. Start trading by opening a position

 

Step 1 - Select your preferred trading pair.

Step 2 - Choose between “Cross margin mode” or “Isolated margin mode”.

Step 3 - Choose leverage.

Step 4 - Enter the price and quantity.

Step 5 - Choose the direction to place your order.

 

 

Notes:

 

After submitting the order, if the transaction isn't completed instantly, you can view the order details in "Open Orders". If the transaction executes immediately, you can view the order details in "Position". From there, you can perform actions like "Adjust leverage" and "Close position". Keep in mind that the actions such as “Adjust leverage” will impact your margin by either increasing or decreasing it.

 

4. Close the position

 

Step 1 - Switch to the closing tab.

Step 2 - Enter price and amount.

Step 3 - Select the position to be closed (close long or short).

 

 

Notes:

• You have two options to close a position: Limit Order or Flash Order. With Flash Order, you can instantly close your position without the need to enter the price and quantity.
• If the close position order isn't executed immediately, you can find it in the "Open Orders" list.
• The close position order can be revoked.

5. Check profit and loss

• If you have an open position, you can check your profit or loss in the "Position" section. It's divided into unrealized PNL and realized PNL.
• After closing a position, you can find position PNL details in the "Order Details."

 

Notes:

• Unrealized PNL: represents the estimated profit or loss after the current position is closed at the market price or the latest transaction price. Red indicates losses, and green indicates profits.
• Realized PNL: includes regular funding fees and any income from partially closing positions. Red signifies losses, and green signifies profits.