Last Updated: 19 Dec 2024
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Note: At 2025-01-21 10:00 (UTC), Binance Margin will adjust the Initial and Maintenance Margin requirements on Cross Margin Pro to enhance the capital efficiency of users’ margin assets. Additionally, how Margin Level and other Cross Margin Pro parameters are calculated will be changed: collateral haircuts and open order losses will now be factored into these calculations. For the previous version of this FAQ, please refer to the second tab above (‘Old Pro Mode’).
Starting from 2024-12-17 00:00 (UTC), new and existing Cross Margin Pro users must complete an updated questionnaire and agree to the updated Margin Terms in order to use Cross Margin Pro. These requirements are in place to ensure that users are aware of and understand the upcoming changes to Cross Margin Pro, and make necessary changes to their positions. You may complete the questionnaire here.
If you do not meet the requirements above, existing Cross Margin Pro accounts will be subject to the following conditions:
In this article, you will learn:
Cross Margin Pro uses a different method to calculate Margin Level compared to Cross Margin Classic. In this article, we will explain how it is calculated and how it functions.
| Parameter | Calculation | Description |
| Margin Level | (∑Net Collateral - ∑Open Order Loss) / ∑Maintenance Margin | Margin Level dictates what functions you may perform on your account and whether margin calls or liquidations are triggered. |
| ∑Net Collateral | ∑Collateral Value - ∑(Liability + Interest) | The sum of collateral values for all assets minus the sum of all liability and outstanding interest in the account (in USDT). Collateral value refers to the value of your assets with collateral haircuts applied, if any. |
| ∑Open Order Loss | ∑Max(0, Collateral Value of assets to be sold in an open order - Collateral Value of assets to be bought in the same open order) | Due to collateral haircuts, the collateral value of assets to be bought in an open order may be less than the collateral value of assets to be sold in the same order. Therefore, Open Order Loss recognizes the potential reduction in Margin Level caused by perceived loss of collateral value in your account, even before the order is filled. For example, an open order to sell 1 BTC (valued at 50,000 USDT) into an altcoin (valued at 40,000 USDT due to collateral haircuts) will effectively reduce your Margin Level corresponding to a perceived loss of the recognized value of assets in your account equivalent to 10,000 USDT. |
| ∑Maintenance Margin | ∑(Loan amount in USDT * Maintenance Margin Rate) Note: The Maintenance Margin Rate (MMR) for each token can be found here. | Total amount of Maintenance Margin (in USDT). *Total refers to the summation over all liability tokens. |
| ∑Initial Margin | ∑(Loan Amount * Initial Margin Rate) Initial Margin Rate (IMR) = 1 / (Leverage - 1) | Total amount of Initial Margin (in USDT). *Total refers to the summation over all liability tokens. |
| Available Margin | Max(0, ∑Net Collateral - ∑Open Order Loss - ∑Initial Margin) | Available margin is used to determine the additional maximum borrowing amount. Learn how to calculate the maximum borrowing amount here. |
Margin Level | Trade | Margin Call | Liquidation | Transfer Out |
5 < Margin Level | Y | N | N | Y |
1.5 < Margin Level ≤ 5 | Y | N | N | N |
1.0 < Margin Level ≤ 1.5 | Y | Y | N | N |
Margin Level ≤ 1.0 | N | N | Y | N |
Note: The illustration below is a purely hypothetical example to demonstrate how Margin Level is calculated, as well as its impacts on the Cross Margin Pro mode.
To calculate the maximum amount that can be borrowed for a specific liability coin and the Margin Level in the Cross Margin Pro mode, both the tiered collateral ratio and the Liability Coin Leverage table are required. For this example, suppose the hypothetical collateral ratio and the liability coin maintenance/initial margin rate are as follows and the Interest is zero.
| Liability Coin | Tier | Max. Leverage | Liability Value in USDC | Maintenance Margin Rate | Initial Margin Rate |
| BTC | 1 | 20x | 0 - 50,000 | 2.50% | 5.27% |
| 2 | 10x | 50,000 - 100,000 | 5.00% | 11.12% | |
| 3 | 5x | 100,000 - 500,000 | 9.00% | 25.00% | |
| 4 | 3x | 500,000 - 1,000,000 | 10.00% | 50.00% | |
| USDT | 1 | 20x | 0 - 40,000 | 2.50% | 5.27% |
| 2 | 10x | 40,000 - 100,000 | 5.00% | 11.12% | |
| 3 | 5x | 100,000 - 500,000 | 9.00% | 25.00% | |
| 4 | 3x | 500,000 - 1,000,000 | 10.00% | 50.00% | |
| SOL | 1 | 20x | 0 - 50,000 | 2.50% | 5.27% |
| 2 | 10x | 50,000 - 100,000 | 5.00% | 11.12% | |
| 3 | 5x | 100,000 - 200,000 | 9.00% | 25.00% | |
| 4 | 3x | 200,000 - 500,000 | 10.00% | 50.00% |
| Collateral Coin | Tier | Amount | Collateral Ratio |
| BTC, USDT | 1 | 0 - 1,000,000 | 1 |
| 2 | 1,000,000 - 2,000,000 | 0.975 | |
| 3 | 2,000,000 - 3,000,000 | 0.95 | |
| 4 | 3,000,000 - 4,000,000 | 0.9 | |
| 5 | 4,000,000 - 5,000,000 | 0.85 | |
| SOL | 1 | 0 - 10,000 | 0.8 |
| 2 | 10,000 - 200,000 | 0.5581 |
Token | Index Price (USDT) |
BTC | 50,000 |
USDT | 1 |
SOL | 200 |
Note: The Position Tiers, Collateral Ratio and Index Price parameters used in this example are meant for illustrative purposes only. You should refer to the Cross Margin Pro Position Tiers and Cross Margin Collateral Ratio sections on the Margin Data page for the latest parameters.
Starting with 0.1 BTC as collateral, you first borrowed 0.3 BTC, and later borrowed an additional 0.7 BTC and 42,311.151079 USDT. No trade orders are placed for this example, so Open Order Loss will not impact Margin Level and Available Margin.
| Parameter | Borrow 0.3 BTC | Borrow an additional 0.7 BTC and 42,311.151079 USDT |
| Position | Collateral: 0.4 BTC Liability: 0.3 BTC | Collateral: 1.1 BTC, 42,311.151079 USDT Liability: 1 BTC, 42,311.151079 USDT |
| ∑Collateral Value | = 0.4*50,000*1 = 20,000 USDT | = 1.1*50,000*1 + 42,311.151079*1*1 = 97,311.151079 USDT |
| ∑(Liability + Interest) | = 0.3*50,000 = 15,000 USDT | = 1*50,000 + 42,311.151079*1 = 92,311.151079 USDT |
| ∑Net Collateral | = 20,000 - 15,000 = 5,000 USDT | = 97,311.151079 - 92,311.151079 = 5,000 USDT |
| ∑Open Order Loss | = 0 (no open orders) | = 0 (no open orders) |
| ∑Maintenance Margin | = 15,000*2.50% = 375 | = 50,000*2.50% + 40,000*2.5% + 2,311.151079*5.00% = 2365.55755395 |
| ∑Initial Margin | = 15,000*5.27% = 790.5 | = 50,000*5.27% + 40,000*5.27% + 2,311.151079*11.12% = 5,000 |
| Available Margin | = Max(0, 5,000 - 0 - 790.5) = 4,209.5 | = Max(0, 5,000 - 0 - 5,000) = 0 |
| Margin Level | = (5,000 - 0) / 375 = 13.333 | = (5,000 - 0) / 2365.55755395 = 2.1136 |
| Margin Level Health | 13.333 > Margin Call Threshold Margin Level is healthy | 2.1136 > Margin Call Threshold Margin Level is healthy |
| Transfer Out | Yes, since Margin Level is more than 5 | No, since Margin Level is less than 5 |
| Collateral Margin Level (applicable to Cross Margin Classic mode) | Collateral Margin Level = 20,000 / 15,000 = 1.3333 | Collateral Margin Level = 97,311.151079 / 92,311.151079 = 1.0542 |
| Convert to Cross Margin Classic (5X) | Yes, since the resulting Collateral Margin Level of 1.333 after switching is more than the Initial Risk Ratio for 5X (1.25) | No, since the resulting Collateral Margin Level of 1.0542 after switching is less than the Initial Risk Ratio for 5X (1.25) |
| Convert to Cross Margin Classic (3X) | No, since the resulting Collateral Margin Level of 1.3333 after switching is less than the Initial Risk Ratio for 3X (1.5) | No, since the resulting Collateral Margin Level of 1.0542 after switching is less than the Initial Risk Ratio for 3X (1.5) |
Starting from 2025-01-21 10:00 (UTC), collateral haircuts will be factored into Margin Level calculations. With larger borrow limits made possible with the launch of 20X leverage on Cross Margin Pro, more stringent measures are required to mitigate liquidation risks arising from large holdings of illiquid collateral. Discounts on such collateral are therefore introduced to ensure that users’ do not take excessively risky positions on their leveraged accounts. For the latest data on Cross Margin Collateral Ratio for each collateral asset, please refer to this page.
Additionally, placing open orders that result in a reduction of collateral value if they are filled will be taken into account for Margin Level calculations. The perceived loss in collateral value due to such orders is known as Open Order Loss, which is a result of collateral haircuts applied on the assets to be bought in these orders.
In order to prevent such orders from causing larger than expected drops in Margin Level (which may trigger liquidations), an additional Margin check is performed when placing orders. In this check, orders that result in a non-positive Available Margin cannot be placed.
Lastly, if a user’s Margin Level drops below the Liquidation threshold while having open order losses, the system will first cancel all open orders in an attempt to recover the user’s Margin Level. This potentially avoids liquidation if that user’s Margin Level recovers above the Liquidation threshold. However, if the Margin Level remains below the Liquidation threshold, then the account will resume the liquidation process.
Using the same Position Tiers, Collateral Ratio and Index Price parameters in the section above, let’s explore how placing open orders may impact Margin Level calculations and Available Margin.
Note: The Position Tiers, Collateral Ratio and Index Price parameters used in this example are meant for illustrative purposes only. You should refer to the Cross Margin Pro Position Tiers and Cross Margin Collateral Ratio sections on the Margin Data page for the latest parameters.
Starting with 0.1 BTC as collateral, you borrow 0.3 BTC and placed an order to sell 0.3 BTC and to buy 75 SOL:
| Parameter | Borrow 0.3 BTC | Place open order to sell 0.3 BTC and to buy 75 SOL |
| Position | Collateral: 0.4 BTC Liability: 0.3 BTC | Collateral: 0.4 BTC Liability: 0.3 BTC |
| ∑Collateral Value | = 0.4*50,000*1 = 20,000 USDT | = 0.4*50,000*1 = 20,000 USDT |
| ∑(Liability + Interest) | = 0.3*50,000 = 15,000 USDT | = 0.3*50,000 = 15,000 USDT |
| ∑Net Collateral | = 20,000 - 15,000 = 5,000 USDT | = 20,000 - 15,000 = 5,000 USDT |
| ∑Open Order Loss | = 0 (no open orders) | = max(0, collateral value of 0.3 BTC to be sold - collateral value of 75 SOL to be bought) Collateral Value of 0.3 BTC = 0.3*50,000*1 = 15,000 Collateral Value of 75 SOL = 50*200*0.8 + 25*200*0.5581 = 10,790.5 Open Order Loss = max(0, 15,000 - 10,790.5) = 4,209.5 |
| ∑Maintenance Margin | = 15,000*2.50% = 375 | = 15,000*2.50% = 375 |
| ∑Initial Margin | = 15,000*5.27% = 790.5 | = 15,000*5.27% = 790.5 |
| Available Margin | = Max(0, 5,000 - 0 - 790.5) = 4,209.5 | = Max(0, 5,000 - 4209.5 - 790.5) = 0 |
| Margin Level | = (5,000 - 0) / 375 = 13.333 | = (5,000 - 4,209.5) / 375 = 2.108 |
| Margin Level Health | 13.333 > Margin Call Threshold Margin Level is healthy | 2.108 > Margin Call Threshold Margin Level is healthy |
In the example above, placing an order to sell 0.3 BTC to buy 75 SOL has resulted in an open order loss of 4,290.5, which reduced the Available Margin to 0. This tells us that we have reached the maximum amount of SOL to place buy orders for. However, you may still place orders to buy other tokens, on the condition that these orders do not introduce more open order losses.
Also, the Margin Level has reduced from 13.333 to 2.108, reflecting the impact of open order loss brought on by collateral haircuts. Once the order is filled, the open order loss will be realized and collateral value for this account will be reduced, resulting in a Margin Level of 2.108.
Lastly, while this example uses collateral haircuts on 75 SOL to illustrate the impact of open order losses, please note that actual haircuts on Cross Margin Pro assets are typically on accounts that carry much larger notional values of illiquid assets. Therefore, collateral haircuts and open order losses are less likely to impact a large proportion of users. Please refer to the “Cross Margin Collateral Ratio” section on the Margin Data page for the latest parameters.
Disclaimer and Risk Warning: This content is presented to you on an “as is” basis for general information and educational purposes only, without representation or warranty of any kind. Digital asset prices are subject to high market risk and price volatility. The information provided does not constitute, in any way, a solicitation or recommendation or inducement to buy or sell the products. The value of your investment may go down or up, and you may not get back the amount invested. Cross-margining contributes to providing greater leverage than a regular margin account, and greater leverage creates greater losses in the event of adverse market conditions. There is increased risk that a user's cross-margin positions will be liquidated involuntarily, causing possible loss. Comments and analysis do not constitute a commitment or guarantee on the part of Binance. You are solely responsible for your investment decisions and Binance is not liable for any losses you may incur. Past performance is not a reliable predictor of future performance. You should only invest in products you are familiar with and where you understand the risks. You should carefully consider your investment experience, financial situation, investment objectives and risk tolerance and consult an independent financial adviser prior to making any investment. This material should not be construed as financial advice. This product may not be available in certain countries and to certain users. This content is not intended for users/countries to which prohibitions/restrictions apply. For more information, see our Terms of Use and Risk Warning. To learn more about how to protect yourself, visit our Responsible Trading page.
