Global digital assets exchange platform Gate.io has launched a 0% Mixed Collateral feature for trading USDT Perpetual Contracts. The new Mixed Collateral component enables traders to trade futures using crypto assets in their spot account as collateral, thus mitigating the risk of their position being liquidated forcefully.
Gate.io users are now able to borrow up to 100,000 USDT for contract trading using Bitcoin as collateral in their spot account, with absolutely 0% interest required. The collateral amount of BTC will be deducted automatically from the user’s spot account, with no need to sell any BTC nor transfer them to the Perpetual Contracts account, and in the meantime, the assets borrowed via Mixed Collateral can’t be withdrawn.
Commenting on this, Marie Tatibouet, CMO at Gate.io said:
“The current world situation has impacted the global economy and the crypto industry. This is the time when the entire crypto community is aiming to introduce more diverse ways to trade.
“As a leading cryptocurrency exchange, we are constantly looking for innovative ways to diversify and improve our users’ trading experience and we are happy to launch the new Mixed Collateral feature to offer our users not only a new possibility in trading Perpetual Contracts but also an option to lower risks when doing so. I think this is a great move to satisfy our user’s trading needs and open new alternatives for them and for everyone else who wants to join us.”
“BTC is the only collateral currency available for this feature at the moment, but currently our technology teams are working very hard to make more markets available soon.”
Bitcoin and Crypto Margin Borrowing & LTV Ratio
Through this announcement, the company reaffirmed that besides improving the trading experience on the platform, they deeply care about the financial well-being of their users. Unlike margin borrowing where users have to pay back the money they borrow with interest, Mixed Collateral directly allows them to leverage their spot account holdings as collateral to trade futures.
However, users should note that when the loan to value (LTV) ratio reaches the threshold, the position will be liquidated forcefully even if there are sufficient funds in the Perpetual Contract account. Therefore, they are encouraged to ensure sufficient funds for the collateral currency and top up the collateral as the LTV ratio surges.