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In Binance Cross Margin, tokens are collectively used as collateral. While trading occurs at the pair level, positions are maintained at the token level. Let's explore how cross margin positions change during trading.
Position Open:
- In Binance Margin Trading, when the assets are transferred to the margin account, it will show as a position and display the position value as it starts to calculate the parameters.
- Binance Margin trading also supports auto-transfer now. When placing a margin order, if there is insufficient balance in your margin wallet, the system will automatically transfer available funds from your spot wallet to your margin wallet. In that case, your margin position will be automatically opened.
Example
Let’s take BTC/USDC as an example. Assume that you don’t have any BTC or USDC positions in your Cross Margin account, and have enabled the Auto-Transfer function.
In this example, you want to long BTC with the 15 USDC in your Spot Wallet. You place an Auto Borrow order to buy BTC, and the system borrows 15 USDC.
The BTC position in green indicates you have 30 USDC worth of BTC as assets and no BTC debts.
The USDC position in red indicates you have 15 USDC debt and no USDC assets.
Note: These two positions are completely independent. Next, let’s see how different close position options will affect your BTC and USDC positions in the next section.
Position Close:
When you have reached the ideal profit or have taken action to stop loss, Binance Margin offers you multiple options to exit a position. Please refer to the detailed closing method below and explore the position display logic after closing.
Option 1: “Close Position” Function:
Each position has its own [Close Position] Button. The ‘Close Position’ function allows you to fully or partially exit a single cryptocurrency position (with a position value greater than 10 USDT).
For more details, please refer to this FAQ - “How to Use the Close Position and Repay Functions on Binance Margin”.
Example:
Let’s assume that you want to close the BTC position. You can click on [Close Position] next to the BTC position.
Enter the amount to close and the token to settle in, such as USDC. For this example, let’s try to choose USDC since we have borrowed USDC to long BTC.
You can choose to close the position in full or partially. Enter the amount or select a close ratio. For example, you can choose to close half of your BTC position and settle in USDC.
After doing this, your BTC position will drop by half, and your USDC position will change from short to long. Since you receive 16 USDC by closing the BTC position, your USDC equity changes from -15 to +1, but the 15 USDC debt is still there since we are closing the BTC position, the close position is only effective for the BTC position, the USDC debt will remain unpaid.
The changes in your BTC and USDC position are shown as below:
Option 2: “Auto Repay” function
When placing an order with “Auto Repay” mode, the order amount filled will be used to automatically pay down your borrowed amount. You will need to repay in the same asset you borrowed (e.g., borrowed BTC, repay in BTC), and any outstanding interest will be repaid first before repaying the borrowed amounts.
For more details, please refer to this FAQ - “How to Use the Auto Borrow and Auto Repay”.
Example:
Let’s assume that you still want to close half of your BTC positions.
Go to the BTC/USDC trading page and select [Auto Repay], then enter the limit price and the amount of BTC to sell. The system will use the order filled amount to repay your USDC debt and any outstanding interest automatically.
After the limit sell order is filled, all BTC will be sold into 16 USDC.
Your BTC position will be reduced by 16 USDC, and the USDC position will change from short to long because you received 16 USDC and repaid 15 USDC debt. Your USDC equity will change from -15 to +1.
The changes in your BTC and USDC position are shown as below:
What are the differences between “Close Position” and “Auto Repay” Function?
In these two scenarios, the BTC position changes are the same. The main difference is how the USDC position will change.
- If you use Close Position for BTC position and settle in USDC, your BTC asset will be sold to USDC, thus your BTC position will reduce, but your USDC debts remain the same.
- However, if you use Auto-Repay order to sell BTC to USDC, the system will automatically repay the USDC debt for you, so both your BTC and USDC positions will drop.
| Close Position (BTC) into USDC | Place BTC/USDC limit sell order with Auto Repay | |
| Description | 50% of your BTC will be sold into 16 USDC (your chosen stablecoin). Your 15 USDC liability remains unpaid. | Place a limit order with Auto Repay to sell 50% of your BTC into 16 USDC (your chosen trading pair). Your 15 USDC liability will be repaid automatically. |
| BTC Position | Equity: reduce 50% Debt: 0 BTC | Equity: reduce 50% Debt: 0 BTC |
| USDC Position | Equity: 1 USDC Debt: 15 USDC | Equity: 1 USDC Debt: 0 USDC |
Note:
- “Close Position” occurs at a token level, and only focuses on the assets and debt of the relevant single token.
- Trading with Auto-repay occurs at a trading pair level, trade base token assets and repays any quoted token debt.
- Ultimately, you can choose the closing method that suits your trading behavior and risk management.
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.