[BitMEX] Increasing Risk Limits for XBT Futures, Resulting in Lower Margin Requirements for Large Positions
We’ve always risen above the competition when it comes to margin requirements for trades both large and small. But we’ve never stopped looking at how to improve, so we’ve decided to increase risk limits on our popular XBT futures contracts (XBTH21, XBTM21, and XBTU21) from 50 to 75 XBT to provide users with even more value.
There are no changes being made to any of our Initial Margin or Maintenance Margin rates – this change relates to the size of position to which those rates apply.
The update, which takes place on 15 March at 08:00 UTC, will result in users with XBT futures positions greater than 50 XBT enjoying margin requirements that are lower than currently required. Meanwhile, the majority of users – those with positions equal to or smaller than 50 XBT – will continue to have the same market-leading margin requirements they are used to.
Here’s a quick summary of changes being implemented on 15 March:
- All users:
- Base Risk Limit and Step on XBT futures will increase from 50 XBT to 75 XBT. Contracts which will benefit from this change will be XBTH21, XBTM21, and XBTU21.
- Existing orders and trades will be unaffected.
- Users with large positions greater than 50 XBT:
- Users with positions over 50 XBT may be eligible for lower margin requirements on XBT futures, as the change lowers the required Initial Margin and Maintenance Margin for most positions above 50 XBT (but does not change any of our Initial Margin or Maintenance Margin rates).
- Users with risk limits set at 100 XBT will see their risk limit automatically increased to 150 XBT. If you fall into this category but have positions at or below 75 XBT, you may be able to manually lower your risk limits back to 75 XBT to enjoy smaller margin requirements.
- The same manoeuvre (manually lowering risk limits to enjoy smaller margin requirements) will be available for users in higher risk limit tiers.
- The lower margin requirements described above only apply when the risk limit is lowered manually.
Here’s some further background on what’s changing and why.
When a user submits an order on the BitMEX platform, they are asked to deposit or ‘lock up’ a certain amount of XBT in order to open a position – this is called the Initial Margin (IM). They are also required to hold a minimum amount of XBT in order to keep the position open – this is the Maintenance Margin (MM). If the margin balance falls below the MM level, liquidation occurs.
We use risk limits to determine how much margin is required to hold the larger positions, and they’re higher for bigger positions to maintain platform stability. After extensive backtesting, we’ve found that we can increase risk limits for XBT futures while ensuring stability is maintained.
All of the risk limits on the BitMEX platform are determined by contract. Here’s what the risk limits on XBT futures look like as of today’s publication date:
Current XBT Futures Risk Limits for XBTH21, XBTM21, and XBTU21 (ending 15 March)
|
Risk Step |
Risk Limit (XBT) |
Min IM |
Max Leverage |
MM |
|
0 |
50 |
1.00% |
100.0 |
0.35% |
|
1 |
100 |
1.35% |
74.1 |
0.70% |
|
2 |
150 |
1.70% |
58.8 |
1.05% |
|
3 |
200 |
2.05% |
48.8 |
1.40% |
|
4 |
250 |
2.40% |
41.7 |
1.75% |
And here’s what they will look like effective 15 March (this update is now live in Testnet):
New XBT Futures Risk Limits for XBTH21, XBTM21, and XBTU21 (beginning 15 March at 08:00 UTC)
|
Risk Step |
Risk Limit (XBT) |
Min IM |
Max Leverage |
MM |
|
0 |
75 |
1.00% |
100.0 |
0.35% |
|
1 |
150 |
1.35% |
74.1 |
0.70% |
|
2 |
225 |
1.70% |
58.8 |
1.05% |
|
3 |
300 |
2.05% |
48.8 |
1.40% |
|
4 |
375 |
2.40% |
41.7 |
1.75% |
We’re confident that this change will serve to extend our competitive advantage on margin requirements. The below table shows how our margin requirements compare as of today’s publication date:
|
Initial Margin Requirement |
BitMEX NEW XBT Futures (Inverse) |
BitMEX OLD XBT Futures (Inverse) |
Binance BTCUSD Quarterly (Inverse) |
OKEx BTCUSD Quarterly (Inverse) |
Deribit BTC Quarterly (Inverse) |
Kraken BTCUSD Quarterly (Inverse) |
|
1 XBT |
1.00% |
1.00% |
2.00% |
0.80% |
1.01% |
2.00% |
|
10 XBT |
1.00% |
1.00% |
2.00% |
1.50% |
1.05% |
2.00% |
|
50 XBT |
1.00% |
1.00% |
5.00% |
2.00% |
1.25% |
6.00% |
|
75 XBT |
1.00% |
1.35% |
10.00% |
2.00% |
1.38% |
10.00% |
|
100 XBT |
1.35% |
1.35% |
10.00% |
2.50% |
1.50% |
10.00% |
|
200 XBT |
1.70% |
2.05% |
20.00% |
3.50% |
2.00% |
25.00% |
|
1000 XBT |
5.55% |
7.65% |
33.33% |
13.50% |
6.00% |
40.00% (above Max) |
We’re looking forward to making more impactful changes to our platform as we speak to our users. If you have any questions about this change, please reach out to Support.