FAQ / Margin trading

How to Use Funding Option

Last updated: January 10, 2019

Funding is provided by Cryptology users and traders for margin trading itself, making us truly an exchange for the community. We enable our users to make bigger trades and to become a creditor at the same time. We have introduced the option to create more possibilities to trade and gain even more revenue using funding in different ways.

What is Funding?

This is an order book that consists of offers (ask) only (no bid). It is intended for lending and borrowing money.

When placing an offer you choose its rate and amount. The time period is always two days. When it expires, an offer returns to the funding book at the initial rate. An offer may be executed partially as well. If it is accepted by a trader, a creditor has no opportunity to change the funding conditions. During the process itself, a creditor can see the rate accumulating, though can’t use it before the funding period is over. Generally, there are three statuses of an offer. The first two indicate subsequent states of a full-cycle offer placement and the last one denotes an offer withdrawn by the creditor:

  • Placed offer means that it is placed though not yet accepted. Once a trader decides to take it, an offer is considered accepted.
  • Active offer means that it is already accepted and in use (partial execution is possible too). So a trader is using the borrowed funds and a lender is gaining the daily rate percent.
  • Pending offer means that it is to be returned to a creditor, as he changes his mind and decides to close it. Thus, the offer is in force until its expiration (two days) and it won’t return to the funding book anymore.

Funding as an Investment

This option offers a secure opportunity to earn interest on fiat and digital assets by providing funding to traders when trading with leverage. As Cryptology guarantees funds return to a creditor. So you can use it if you prefer secure investing to risky trading. To do this, create your own offer, so that traders can bring you a revenue instead the money they borrow from you. You are free to provide funding in BTC, EUR, BCH, ETH and LTC to traders on Cryptology. In this case you can choose the amount and daily rate. The term defaults to two days.

Funding as Borrowing Funds

If you wish to trade with more funds and are not eager to use your own ones, then funding could be the right option to increase your position by borrowing money from another trader willing to act as a creditor. In this case funding does not suppose providing money but borrowing it, thus enabling you to trade more assets than you can afford with your own funds only. All you need to do is choose levels of increasing the value of the position being opened. You can see the daily rate specified in the right column together with other parameters. The term defaults to two days. For more details, please see “How to Trade on Margin” guide.

Click on the “Funding” tab to start.

Step 2: Find Offer Entry section just at the top of the page and enter the amount and the daily rate of your offer. To proceed, click on the “Place” button and then on the “Apply” button in the confirmation message.

Step 3: To find all the placed offers, see Placed section below. To close them, click on the “Close” button.

Step 4:All closed offers are provided in History section below.

Risk Reminder:
Investing in digital assets supposes high risks because of large price fluctuations. Before investing, please be aware of all the risks of investing in digital assets and be careful with your investment decisions.

Glossary

Creditor - The one who provides money as an offer to be taken by a trader willing to increase the value of position.

Offer - A proposal to provide a certain amount of funds to borrow, gaining an interest instead.