Shiba Inu (SHIB), Terra (LUNA), and Solana (SOL) Cryptocurrency tokens have been added to Huobi Global’s catalog of cryptocurrencies that are supported for Margin trading.
Huobi Global is a China-based crypto exchange platform and is one of the top exchange platforms in the world based on trading volume. It has announced that it will now offer support for its users to trade SHIB, LUNA, and SOL marginally with leverage up to 3x.
Huobi’s Margin Trade Feature
Huobi Global’s marginal trading feature had been integrated into its general framework as early as 2014. The company launched its margin trade program with the listing of BitVC in 2014.
The inception of Huobi’s Margin Trade program was when cryptocurrency was in its infant stage developmentally. The awareness of Bitcoin and cryptocurrency back then was at an all-time low, with only a very few elite developers aware of the budding industry.
Huobi’s Global margin trade feature has since developed holistically and now supports both cross margin trade and isolated margin trade.
Huobi Global’s Gross Margin And Isolated Margin Sub-Features
In its cross margin trading model that the exchange launched last December, a trading position can leverage more margin from the total margin balance the trading cryptocurrency has as its intrinsic value; by doing this, the token’s marginal value can offset a losing position that will normally be liquidated.
In the case of the exchange’s isolated margin model, there is a fixed price that is leveraged as collateral. This means that a trader will have to separate a stand-alone amount of collateral for an equivalent amount of funds. Solana (SOL) is the only crypto token that Huobi supports for isolated margin trading.
Cryptocurrency Margin Trading And Derivatives Trading In The DeFi Sector
Emphasis has to be placed on the different qualities that crypto margin and derivatives trading have to offer so that investors won’t be confused in any way when they want to trade either feature.
Cryptocurrency margin traders place their trade orders, either buy or sell orders in the spot market. They choose an appropriate leverage option proportional to their allowable risk ratio to trading their cryptocurrency token of choice.
Cryptocurrency derivatives trading mostly refers to cryptocurrency futures trading. Future traders operate in the DeFi derivatives market by leveraging future contracts, which offers more robust leverage than margin trading. Futures trading can offer up to 200x leverage options, but investors should note that the market’s volatility is proportional to its high leverage and possible returns.
Huobi earlier this year canceled its derivatives trading services in multiple countries across different continents, citing regulatory issues with different local and international regulators.
Mainstream media has reported that Shiba Inu has been added for marginal and futures trading in the spot market by top derivative exchange By bit earlier this December.
Local competitors of Huobi Global OKex and kuCoin have also listed the Shiba meme coin for marginal trading earlier in May.
US-based Kraken trading platform, however, has not listed SHIB for margin trading in the meantime.