Important: Margin trading is only offered to eligible institutional customers with trading accounts.
Warning: Margin trading is a high risk activity. Please read carefully the Risk Warnings and Terms for Margin Services on bullish.com.

What is collateral?

Collateral determines how much you can borrow and it is a form of security to cover potential losses. Collateral can be liquidated (forcibly sold) to repay your debts. Collateral is liquidated to reduce the risk of your account entering Default when it becomes dangerously high.

How is your collateral calculated?

Collateral Value

A trading account’s collateral value is a single USD value that represents the current value of all collateral in the account. It is used in leverage calculations and liquidation scenarios and is needed to determine margin.

Collateral Value is calculated as the sum, across all assets, of the product of the liquid asset quantity held in a trading account, multiplied by that asset’s collateral rating and the current index price of the asset. Liquid assets are those that are currently idle plus those on hold in open limit orders (for limit orders we use the worst-case scenario of the order being filled or not being filled, to determine the applicable collateral rating and therefore the collateral value) plus unsettled profits or losses denominated in that asset.

Expressed as a formula, then:

Collateral Value (in USD) = (Asset’s Liquid Quantity x Collateral Rating x Index Price), for all Assets where the Liquid Quantity of an Asset = max(Idle balance - unsettled losses, 0) + (order quantity if collateral rating is lowest) + (unsettled profits)

For example, suppose your trading account consisted of:

  • 100 BTC idle (valued at US$20,000, with a collateral rating of 95%)
  • 5,000 USDC idle (valued at US$1, with a collateral rating of 100%)
  • A limit order to buy 10,000 XYZ using 100,000 USDT (where XYZ has a collateral rating of 0% and USDT collateral rating is 50%)
  • Unsettled losses of 250 USDC
  • Unsettled profits of 500 USDT

Then your liquid asset quantities would be:

  • BTC: max(100 - 0, 0) + 0 + 0 = 100
  • USDC: max(5,000 - 250, 0) + 0 + 0 = 4,750
  • USDT: max(0 - 0, 0) + 0 + 500 = 500
  • XYZ: max(0 - 0, 0) + 10,000 + 0 = 10,000

And the trading account’s collateral value would be:

= (100 BTC x US$20,000 x 95%) + (4,750 x US$1 x 100%) + (500 USDT x US$1 x 50%) + (10,000 XYZ x $10 x 0%)

= US$1.905 million

Note: Only assets have collateral value. Derivative positions do not contribute to collateral. However unsettled profits or losses on derivative positions will affect your collateral value. 

Collateral Rating

The Collateral Rating determines what percentage of the notional value of an asset counts towards your total collateral value. The rating is based on the liquidity profile of an asset.

Important: Collateral Ratings are subject to change at any time.
Asset Collateral Rating
AAVE 25%
APE 0%
AVAX 25%
BCH 20%
BTC 95%
CHZ 20%
CRV 20%
DOGE 25%
DOT 0%
EOS 20%
ETH 85%
GALA 10%
GRT 20%
LINK 25%
LRC 20%
LTC 20%
MANA 20%
MATIC 25%
NEAR  20%
PYUSD 45%
SAND 25%
SOL 20%
SUSHI 20%
UNI 25%
USDC 100%
USDT 70%
USD* 0%
TRX 15%
XRP 60%

*Please note that currently USD fiat is not eligible as collateral.

Viewing your collateral

To view your current collateral:

  1. On the left hand navigation, choose Portfolio.
    Portfolio tab in left-hand navigation.png
  2. By default, Overview should already be pre-selected. You will see the available collateral in US dollars.

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