Crypto Borrow is a product that allows you to borrow digital assets from our exchange using your own assets as pledge.
This tool allows you to borrow cryptocurrency for any period of time and use it for trading, transfers or withdrawals. The assets on the Collateral Balance are used as pledge.
How do I get a loan?
Important information: The number of assets available for borrowing is determined proportionally by free pledge — the amount of unallocated Collateral Balance funds not used to support positions or loans. A collateral equivalent is required for any amount of the loan asset and depends on account leverage. Account leverage determines a maintenance margin fraction ratio between 50% (1x leverage) and 2.5% (10x leverage). Increasing account leverage would allow you to borrow more funds, up to the almost equal amount on the market. However, it is connected with additional risks, such as position liquidation. In that case, it is really important to check the account risk score and add more funds to the collateral balance to avoid liquidation. Open margin and futures positions impact the amount of free pledges: the larger the positive value of PnL (Profit & Loss), the more is available for borrowing.
To obtain a loan, follow these simple steps:
- Go to the “Crypto Borrow” page from the WhiteBIT homepage or from the Collateral page in the upper right corner above the list of available assets;
- Select the cryptocurrency and the amount you want to borrow from the exchange. The maximum loan amount depends on the number of assets in your Collateral Balance and the amount of leverage defined in your account settings;
- Before confirming the loan, please read the loan details carefully, especially the liquidation terms;
- Congratulations! The specified loan amount will be transferred to your Main Balance.
Please note: from the moment you receive the loan, interest will start accruing per second for the use of the borrowed assets. Also, the number of assets on the Collateral Balance will update and become negative, showing how much you need to pay back.
How do I repay a loan?
To repay a Crypto Borrow, follow one of the steps:
- On the Active Loan page, select the loan you want to close and click the “Repay” button to repay it with the borrowed asset;
- In the window that opens, enter an amount that may be less than (if you want to partially repay the loan), equal to, or greater than the loan amount along with the accrued interest on the financing. Then click the “Confirm” button;
- Done! Once the loan is repaid, its status will change to “Completed” in the “History” section.
- On the Active Loan page, click the Close button on the loan you want to pay back to close it using your pledge;
- In the window that opens, confirm your actions;
- Done! Once the loan is closed, its status will also change to “Completed” in the “History” section.
What is the percentage on the Risk Scale?
The percentage on the Risk Scale reflects the ratio between the unused funds on the Collateral Balance and the funds that have been used to support margin positions or open loans. This indicator is a measure of solvency within the Collateral Balance. Its values can range from 0% to 100%. A value of 0% indicates that all funds are available, and the user is fully capable of making payments. A value of 100% indicates that the borrower is completely insolvent.
The scale has colored marks, which indicate the degree of risk associated with the loan and reflect the approach to the liquidation process, taking into account the current open positions and the selected leverage value. The orange sector indicates the Margin Call zone, which means that the borrower should take measures to reduce risk. The red sector indicates a near liquidation state, which requires immediate action to avoid losses.
What is the liquidation price, and how is it calculated?
Liquidation is an automatic sale of the assets that serve as a pledge on the Collateral Balance at the current market price in order to repay the borrowed funds.
The liquidation price is the estimated price of the borrowed asset in the market, displayed in USDT equivalent, at which the loan is liquidated. It is not possible to calculate a liquidation value for USDT, so in this case liquidation is based on the market price of the collateral rather than the price of the borrowed asset itself.
When the amount of available margin decreases to below the minimum margin, the user receives a Margin Call notification to their email, according to Crypto Borrow's terms and conditions. A Margin Call is triggered if the loss in the position is 25% of equity, not taking into account leverage. It is important to note that when you receive a Margin Call, your active orders to increase the price are automatically canceled.
Liquidation occurs when you lose 50% of your own funds in a position (without considering leverage). Only assets that are collateralized on the Collateral Balance in the amount necessary to cover the USDT equivalent of the loan amount will be liquidated.
This process includes automatic sale of collateral assets at the current market price to recover the borrowed funds and restore the balance. Liquidation does not affect other balances of the user.
What assets can be borrowed? What assets can I pledge a Loan with?
The same assets supported as a pledge for Margin Trading are available within Crypto Borrow: ADA, APE, AVAX, BCH, BTC, DOGE, DOT, EOS, ETH, LINK, LTC, MATIC, NEAR, SHIB, SOL, TRX, USDC, USDT, XLM, XRP.
ADA, APE, AVAX, BCH, BTC, DOGE, DOT, EOS, ETH, LINK, LTC, MATIC, NEAR, SHIB, SOL, TRX, USDC, USDT, XLM, XRP can be used as a pledge.
Please note that WhiteBIT Coin (WBT) can act as a pledge for a loan, but the asset cannot be borrowed.
The national currency (fiat) is currently unavailable for loans, but you can always use the Exchange option. The total amount of assets on the Collateral Balance and all open margin and futures positions with a positive P&L (Profit & Loss) value are used to pledge the loan.
Open margin and futures positions affect the amount of free margin: the more plus the P&L (Profit & Loss), the more is available to borrow.
For how long can I borrow digital assets? How is the loan fee calculated?
The loan has no time limits if there are enough assets on the Collateral Balance to pledge the loan. Also, there is no limit to the number of loans available and new loans become unavailable only if there is insufficient collateral in the Collateral Balance.
The dynamic fee for using loan funds is 0.0585% per day and is calculated every second in the currency of the loan. You can return the loan at any time after opening it. To complete this, you must transfer funds to the Collateral Balance of the loan asset.
How can I use the assets which are used for the loan?
The use of the assets of the Collateral Balance is not limited in any way as long as the indicator of free pledge exceeds zero when there are unallocated funds on the balance that are not used to support positions and loans. In a situation where pledged assets become insufficient, a Margin Call occurs.
It's important to note that the same transactions are available for the leveraged assets themselves as for the assets on the Total Balance – you can sell, transfer, withdraw, and invest them in Crypto Lending plans.
How do I transfer funds from the Collateral Balance with a loan?
To do this, select the “Show Available Including Loan” function in the Transfer window. After entering an amount that is less than or equal to the current funds on the Collateral balance and clicking “Confirm”, the specified assets will be transferred to the selected balance.
Why do I see a negative balance on my Collateral Balance for my borrowed currency?
The negative balance is displayed for convenience to indicate an open loan. A negative balance does not limit the possibility of opening margin and futures positions for the loan asset if unused funds are on the Collateral Balance (positive value of the free margin). If an asset for which the loan is opened is transferred to the Collateral Balance, the loan will be partially or fully repaid, depending on the transfer amount.
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