1. How to Apply for Hedging Service?
The Hedging Service is not applicable to the sub-account, please switch to the main account first. Read the "Hedging Service User Agreement", check the box you have read, and click [Activate].
2. Which Coins are Supported?
There are 3 hedging coins supported by ViaBTC Hedging Service: BTC, BCH and LTC. There are 2 types of coins involved in hedging transactions, the hedging coin and the settlement coin. When hedging a certain cryptocurrency, the cryptocurrency is called hedging coin. As all hedging coins are settled by USDT, USDT is named as settlement coin.
3. What is Hedging Amount?
(1) Minimum Precision of Hedging Amount
The minimum precision of hedging amount is 8 digits after the decimal point.
(2) Maximum Hedging Amount
The system calculates an account's maximum hedging amount based on the daily average income of all mining accounts (including sub-accounts) in recent 7 days and current hedging situation.
If there is no hedging order currently, the calculation formula is:
Max. hedging amount = Average daily income of mining in recent 7 days * 180.
If there is a hedging order, the calculation formula is:
Max. hedging amount = Average daily income of mining in recent 7 days * 180 - Current hedging amount.
(3) Price Interval
The minimum price interval for hedging price ranges from index price * 95% ( the lowest price) to index price * 10 ( the highest price). If the setting price is out of this range, the order will not be placed.
(4) Minimum Price Precision
The minimum price precision for BTC, BCH, and LTC is 2 digits after the decimal point.
4. How to Calculate the Interest?
(1) Daily Interest Fee
When a hedging order is executed, it means that you have borrowed a certain amount of hedging coins from the system (Borrowed Coin Amount = Hedging Amount - Initial Margin). ViaBTC will charge 0.05% of the borrowed coins as the daily interest fee.
The calculation unit for daily interest fee is hedging coin, which is calculated once a day (calculated as one day even less than 1 day). If repay in advance, the interest of that day will be calculated based on the actual borrowed amount. The daily interest fee is calculated as single interest. When repaying or ending hedging order, the interest will be paid first, and then the borrowed coin.
(2) To-be-repaid Interest
When a hedging order is executed, the system will charge 0.05% of borrowed coin as daily interest fee. The interest part will be accumulated in the To-be-repaid Interest. If repay in advance, the interest will be paid first.
To-be-repaid Interest = Borrowed Coin Amount + Total Interest Fee - Total Interest Repaid.
(3) To-be-repaid Amount
When a hedging order is executed, it means that you have borrowed a certain amount of hedging coins from the system ( Borrowed Coin Amount = Hedging Amount - Initial Margin). If repay in advance, the borrowed coins will be repaid after the current total interest has been paid off.
To-be-repaid Amount = Borrowed Coin Amount + Total Interest Fee - Total Amount Repaid
5. How to Repay (Deleverage)?
The repayment operation in ViaBTC Hedging Service is equivalent to the deleveraging in margin trading. When the Repaid Amount is equal to the To-be Repaid Amount, the current hedging order comes to an end. When the system is executing repayment, the interest will be paid first, and then the borrowed coins. There are 2 approaches of repayment for hedging account: Manual Repayment and Auto Repayment.
(1) Manual Repayment
When manual repayment is executed, the system will deduct the input Repaid Amount from the current hedging account to proceed repayment. For more information, please refer to [How to End Hedging Order?] guide.
(2) Auto Repayment
When opening Auto Repayment, the balance of all mining accounts will be deducted at 10:00 (UTC) every day for repayment until the hedging order is completed. For more information, please refer to [How to End Hedging Order?] guides.
If the balance of all mining accounts ≥ To-be-repaid Amount, the auto-repaid amount is To-be-repaid Amount. When the current hedging order ends, the hedging coin ( Total Balance - To-be-repaid Amount) will be kept in hedging account, and it will not be returned to the main mining account automatically.
Note: Once Auto Repayment is enabled, [Auto Conversion] and [Auto Withdrawal] functions of all mining accounts will be turned off automatically. You can also choose to re-open [Auto Conversion] and [Auto Withdrawal] manually if needed.
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