Borrow funds and start your trading career with Binance Margin Trading.

I recently made an articles about my trades in Binance and a simple tutorial about the Binance Future Trading which, personally, I can find helpful for anyone who wants to start their trading career. You can find the links of my articles below, at the end of this article.

So in this article, I will share the steps on how to start using your Margin Account in Binance in the simplest and most understandable way as I can.

Overview

Binance - a famous cryptocurrency exchanger where user can trade, buy and sell cryptocurrency in the easiest way.

Margin Trading - is an account in Binance where you can borrow funds for you to start buying or trading a certain cryptocurrency.

How to start in Margin Trading?

In case you have read my recent article about Futures Trading and confused about its differences in Margin Trading because of the 2 different types of Future Trading - Isolated and Cross Margin Mode, here's an explanation;

• Isolated Margin Mode - Only uses your specific amount you set in the position you made.

• Cross Margin Mode - Will use all the funds that have in your Futures Account to avoid quick liquidation.

  Example; You have $100 in your Futures Account and you use Cross Margin Mode with a margin position of $20. In Cross Margin Mode, the remaining $80 in your Futures Account will be in use to have a safe distance from the liquidation price.

Going back in Margin Trading, I can say that this way is a lot safer and not so risky compared to Future Trading - where in an instant you can lose your funds.

Here are the simple steps to start trading in your Margin Trading Account;

1. First, of course, you would be needing some funds in your Binance account. If you don't have, then fund it now, but if you don't want to put some funds on it, then this article is not for you.

2. Open/Create a Margin Trading Account. You only need to answer a quick 10 questions for you to open an account. Don't worry, the questions are easy and can be finished in just a couple of minutes.

3. Let's say to you have funded your Binance account with USDT.

Go to your Wallets, click the Margin above. Refer to the image below.

4. And click Transfer.

5. After clicking the Transfer, you will be redirected in this part. And then click the encircled arrow.

6. After clicking it, it will show you lots of cryptocurrencies that you want to transfer in your Margin Account. In our case, we will choose USDT. And then let's transfer 10 USDT into our/my Margin Trading Account.

Just click Transfer and the funds will be immediately transferred to your Margin Account.

Viola! We have transferred now our 10 USDT to our Margin Account.

Why do we need to transfer funds into our Margin Account?

The funds you have transferred will be used as a collateral for the amount of a certain cryptocurrency you want to borrow.

How much can we borrow in Margin Account?

The maximum amount you can borrow is 2 times than your collateral - the amount you have transferred.

For example: You have transferred 100 USDT, then you can borrow 200 USDT in your Margin Account.

In our case, because we have transferred 10 USDT, we can now borrow 20 USDT - this can be use for trading in your Margin Account.

How much is the interest in your borrowed amount?

Every cryptocurrencies have different accrued interests. For example;

Bitcoin (BTC) have 0.00125% interest every hour. So in a day, you have 0.00125 x 24 hours is equal to 0.03% interest, which is very good.

While in USDT, there is a 0.00416667% interest every hour which means 0.1% everyday, and this is still considerable.

How to repay the borrowed amount?

There are two ways to repay what you have borrowed;

First

• You can go to your trades.

• Click the Margin - means your Margin Account.

• Click Repay.

• Then SELL.

This will automatically repay your debts after doing the procedures.

Second

• The other way is also simple. All you have to do is click the Repay.

• Then you will be redirected here. All you need is to put the amount of your debt and click Confirm.

Then, that's it! You can borrow anytime in your Margin Account as long as you have a collateral.

Final say and a reminder.

I did say that trading in your Margin Account is not so risky unlike in Futures Trading, but still, because the cryptocurrency market is volatile, you can still lose your funds. Here's an example;

You have borrowed 400 USDT in your Margin Account and used it to buy 1 BCH worth 400 USDT. And because the market is so volatile, and unfortunately, the price of BCH went down to 300 USDT per BCH, which -25% from the price you bought it.

Now, you wanted to stop the trade and repay your debt. When repaying, because you lost 25% of your trade, which is 100 USDT, the 100 USDT will be deducted from your collateral leaving you with only 100 USDT from your total amount of 200 USDT after repaying and closing the trade.

Trade with caution.

Helpful articles about Binance Trading:

Future Trading: Isolated vs Cross Margin Mode.

My first trades in 2021 with Binance.

Lead Image From : ibuzzle.com

@Ryryry143