Bybit Institutional integrates spot trading into Portfolio Margin Mode

Rick Steves

Bybit Institutional, part of Bybit – the world’s third-largest crypto exchange by volume, has upgraded its Portfolio Margin Mode.

This improvement now includes spot trading capabilities. The upgrade allows traders to incorporate spot positions into their hedging strategies, enhancing risk management in the volatile cryptocurrency market.

Previously, Portfolio Margin Mode grouped USDC and USDT derivatives of the same currency into one risk unit, using stress testing for margin requirements. The new version allows traders to use spot holdings to hedge against derivatives position losses, aiding in navigating market volatility and reducing the impact of price fluctuations.

The Portfolio Margin Mode

The key benefits of integrating spot trading into Portfolio Margin Mode include:

Reduced Margin Requirements: By balancing profits and losses between spot and derivatives positions, traders may lower overall margin requirements, increasing capital efficiency.
Seamless Integration: Spot positions are easily integrated into the Portfolio Margin Mode, enabling unified portfolio management on a single platform.

Traders have the option to participate in spot hedging for spot prices, though this feature is not automatically enabled. They must actively choose to opt in. The system then checks if the trader’s maintenance margin rate (MMR) is below 100%, allowing switching only if this condition is met.

Ben Zhou, Co-founder and CEO of Bybit, noted that the expanded Portfolio Margin Mode offers traders more confidence in managing market volatility, optimizing risk management, and enhancing the potential for successful crypto trading. “Bybit’s commitment to innovation and trader empowerment is exemplified by the expansion of its Portfolio Margin Mode to include spot trading. This enhanced feature empowers traders to navigate market volatility with greater confidence, optimize risk management practices, and potentially reap the rewards of successful crypto trading.”

Reducing counterparty risk

A few months ago, Bybit integrated with Copper’s ClearLoop network, marking a significant step forward in addressing the needs of institutional investors and reinforcing the principles of good governance, transparency, and accountability.

The crypto exchange took a monumental leap forward by seamlessly merging with Copper’s pioneering ClearLoop network. This essential partnership introduces a new paradigm of off-exchange settlements, thereby ushering in an era of increased capital effectiveness and diminished counterparty risk.

Access to ClearLoop’s trust documentation, which directly tackles exchange counterparty and insolvency risk, allows Bybit’s clients to navigate the trading landscape with heightened security and confidence.

A critical advantage of this integration is the provision for expedited off-chain settlements while trading on Bybit, an indispensable feature during market turbulence when delays in blockchain transaction confirmations can escalate.

Protecting assets under Copper’s Multi-Party Computation custody and the ClearLoop integration showcasing a transparent English Law trust structure provides institutional clients with an additional layer of empowerment.

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