1. General Provisions
1.1 For the purpose of regulating the margin trading and margin loans of digital assets, maintaining market order, and protecting the legitimate rights and interests of users, these rules are formulated in accordance with the principles of fairness, openness, and impartiality.
1.2 These rules are additional to the Poloniex Margin Trading User Agreement.
1.3 These rules shall apply to margin loan, cross margin trading, and other relevant actions on Poloniex. Any matter for which there is no specific provision in these rules shall be subject to the Poloniex Margin Trading User Agreement, Poloniex User Agreement, and other relevant provisions of Poloniex.
1.4 Poloniex reserves the right of final interpretation for these rules.
2. Margin
2.1 Users must ensure they have available assets that can be used as margin in their spot account before borrowing. Balances of currencies that can not be used as margin in the spot account and crypto balances in other accounts will not count towards the user's margin for cross margin trading.
2.2 Poloniex has the right to adjust the range of currencies that can be used as margin, which shall be subject to Poloniex's official announcements. For more details, please see the link.
2.3 For the purpose of ensuring asset security, Poloniex has the right to use the collateral rate to calculate the value of margin assets based on their market prices, and also the right to adjust the collateral rate of currencies based on the actual market situations and the risk control policy.
3. Margin Loan Rules
3.1 For the purpose of ensuring asset security, Poloniex has the right to adjust the range of borrowable currencies and the borrow limit for each currency. For more details, please see the link.
3.2 A currency's borrow limit refers to the maximum amount of tokens that are available for a user to borrow for a margin trading pair. Poloniex will calculate a user's borrow limit for a currency based on their assets, debts, etc. The maximum amount of tokens a user can borrow in a currency cannot exceed the currency's borrow limit.
In these rules, Currency borrowed = Currency debt + Currency in use
Borrow limit for a currency = Minimum value (Remaining borrowable amount + Amount borrowed, Expected borrow limit).
Expected borrow limit = Free margin * (Leverage - 1) / Last price of the currency
Free margin = Maximum value (Total margin - Used margin, 0)
Total margin = Effective balance + Total debts
Effective balance = ∑(Balance of the currency * Last price of the currency * Collateral rate of the currency)
Total borrowed = -∑(Borrowed in the currency * Last price of the currency)
Total debts = ∑(Debt in the currency * Last price of the currency)
Used margin = - ∑(Debt in the currency * Last price of the currency * Initial margin ratio of the currency) + ∑(Currency in use * Last price of the currency / Leverage)
3.3 Auto borrow and auto repay rules. Users may choose to enable the auto borrow function before trading margin pairs; when enabled, the system will automatically borrow a loan after an order is placed according to the order amount, and interest will start to accrue on the funds borrowed after the order is filled. Similarly, the system will automatically use the assets users transfer, deposit, or buy into their spot account to repay any debt in the corresponding asset.
4. Interest Calculation and Deduction
4.1 Interest-calculation rules: Simple interest shall accrue on an hourly basis and based on the borrowed amount.
Calculation formula: Interest = Borrowed * Daily interest/24
4.2 Loan interest is included in a user's debt amount. If there is any outstanding interest unpaid for a long time, the margin ratio of the user's account may be reduced to a level below the liquidation line, leading to the risk of forced liquidation. In view of this, users are advised to pay interest regularly.
4.3 Poloniex may adjust the interest rate at any time based on market conditions. The adjusted rate will only apply to the outstanding loan and the interest accrued after the change is made. For the latest interest rate, please refer to: link.
5. Risk Control and Insurance Fund
5.1 Poloniex has the right to monitor the margin ratio of a user's spot account on a real-time basis and adopt corresponding measures in response to the fluctuation of the margin ratio.
In these rules, the margin ratio of a spot account = Margin / Maintenance margin,
where: the market value of all assets is calculated in USD
Maintenance margin = -∑(Debt in the currency * Last price of the currency * Maintenance margin ratio of the currency)
5.2 When the margin ratio of a user's spot account drops to 200% (risk alert), the system will trigger a margin call and inform the user of the liquidation risk via email; upon receiving the notification, the user needs to transfer in more assets to be used as margin to avoid liquidation.
5.3 When the margin ratio of a user's spot account drops to below 100% (forced liquidation), forced liquidation will occur, during which the user cannot perform any actions. All margin assets in the user's spot account will be liquidated to repay the interest and loan. When the margin assets in the user's spot account are not sufficient to cover their debts (bankrupt), the system will use assets (cap applied) from the insurance fund to repay the user's loan, and Poloniex reserves the right to recover the outstanding debt from the user.
5.4 Users shall pay due attention to the risks of margin trading and promptly adjust their position-holding ratio to avoid forced liquidation. All losses that arise out of or in connection with forced liquidation shall be borne exclusively by the user, including but not limited to: losses that arise when the user is unable to timely adopt corresponding measures after receiving warning notice from the system, because the margin ratio of the relevant spot account reaches the warning line and then quickly reaches the liquidation line due to violent fluctuation in the digital asset prices.
5.5 In case of forced liquidation, the system will charge 2% of the total market value of the liabilities in the user's spot account as a liquidation fee and transfer it to the margin insurance fund.
5.6 In case of bankruptcy after forced liquidation, Poloniex has the right to prohibit users from transferring funds out of their spot accounts. And the margin assets transferred by users into their spot accounts will be first used to repay the outstanding debts.
5.7 Poloniex will manage the total amount of margin loans on the platform. When it reaches the pre-set maximum amount of total margin loans, the system will prohibit margin lending and adjust the maximum amount of single margin loans and total margin loans on the platform according to the actual operation conditions and risk level of the market.
5.8 For the purpose of ensuring asset security, only when users have free margin for a crypto asset in their spot accounts can they transfer that asset to other accounts.
In these rules, Currency borrowed = Currency debt + Currency in use
Free margin = Maximum value (Total margin - Used margin, 0)
Total margin = Effective balance + Total debt
Effective balance = ∑(Balance of the currency * Last price of the currency * Collateral rate of the currency)
Total borrowed = -∑(Borrowed in the currency * Last price of the currency)
Total debts = ∑(Debt in the currency * Last price of the currency)
Used margin = - ∑(Debt in the currency * Last price of the currency * Initial margin ratio of the currency) + ∑(Currency in use * Currency price / Leverage)
6. Supplementary Rules
6.1 Poloniex provides information release, supervision and risk control services for cross margin trading and loans. The Platform does not provide any income guarantee or capital guarantee for users' margin transactions on Poloniex. Investors should fully realize that margin trading is subject to relatively high risk and should pre-assess the possible losses, confirm that the risks are controllable and affordable and participate voluntarily on the basis of signing the Poloniex Margin Trading User Agreement.
6.2 The terms "exceeding" and "below" do not include the number, and "not exceeding", "not less than", "above", and "reach" include the number.
6.2 These rules are formulated by Poloniex and will take effect after being announced to all users. The same applies to amendments.
6.4 These rules shall be interpreted by Poloniex.
6.5 These rules shall be effective as of 1st December 2022.
6.6 Related formulas