Binance Multi-Assets Mode.
With the introduction of Multi-Assets Mode, users can now diversify their stable coin exposure between BUSD and USDT. Additionally, this feature also allows arbitrageurs and sophisticated traders to efficiently manage their margin and P&L. Making it an ideal product for long-term traders, arbitrageurs, and hedgers.
Multi-Assets Mode allows users to trade USDⓈ-M Futures across multiple margin assets. Presently, Binance Futures offers USDT-margined and BUSD-margined contracts under the USDⓈ-M Futures product line. With the newly launched Multi-Assets Mode, users will share their margin across USDT-margined and BUSD-margined contracts. Any profits made on either contract can be used as margin; this means that one position’s profits can offset losses in another losing position. Thus, the margin balance only reflects the net P&L between positions in the two markets. This new feature only supports the Cross Margin Mode.
Meanwhile, users who want to trade with only a single margin asset (i.e, BUSD only) can select the Single-Asset Mode. In this case, the margin is shared across positions in the same margined asset (i.e, BUSD-margined contracts). Profits and losses of positions within the same margin asset can offset each other. The Single-Asset Mode supports both Cross Margin Mode and Isolated Margin Mode.
Benefits of Multi-Assets Mode: Diversification and Increased Capital Efficiency.
Users can diversify across various stable coins and increase their capital efficiency by using the Multi-Assets mode. With this feature, users can share their margin across USD-margined products available on Binance Futures (USDT & BUSD); this is particularly useful when opening positions in the two markets.
Let’s run through a quick example. Assume that you are holding a long-term position of 10,000 BUSD worth of BTC/BUSD perpetual contracts @ $50,000 each.
You predict a temporary pullback in Bitcoin and want to hedge the expected downside risk with a USDT quarterly contract. To hedge, you sold 5,000 USDT worth of BTCUSDT quarterly futures at $50,500 each.
Let’s assume that your prediction came true, and Bitcoin plunged 20%. As a result, your position in BTC/BUSD perpetual shows an unrealized loss of -2,000 BUSD. However, because you’ve hedged half of your long-term position, profits from the short hedge, which amounts to 1,010 USDT, offset the losses in BTC/BUSD Perpetual. As a result, your margin balance is less impacted despite the sharp pullback in prices, reducing the probability of you facing liquidation.
Additionally, the shared margin feature allows traders to arbitrage between the two markets without the need to maintain multiple accounts or margins. Traders would simply deposit margin either in USDT or BUSD in their wallets and can use the same margin asset to open positions in both markets.
Profits and Loss in Multi-Assets Mode
When your BUSD or USDT wallet balance is positive, the profit generated is the trading pairs’ valued asset. For example, if you trade a USDT contract, all profits generated are in USDT; if you trade a BUSD contract, all profits are in BUSD;
When your BUSD or USDT wallet balance is negative if the loss is less than 10,000 USDT/BUSD, it will not be automatically converted; if the loss amount is greater than 10,000 USDT/BUSD, it will be converted in proportion to the USDⓈ-M Futures wallet asset balance, deducting your corresponding margin assets.
In short, the profits and losses generated are always trading pair-denominated assets, but in the case of losses, the platform has added an automatic exchange mechanism to help users balance their accounts and increase the utilization rate of funds.
What Are BUSD-M Futures?
Traditional crypto derivatives trading is a challenging endeavor by itself. But traders should know that with Binance Futures, there is more on the menu than just plain-old futures and margin trading.
Binance Futures has continuously expanded its product range to provide more trading opportunities for users. Its latest addition, BUSD-Margined futures, offers cost-saving benefits that can help traders realize more profits.
BUSD-Margined Futures are a type of linear futures product that is quoted, collateralized, and settled in BUSD. As a result, not only are transactions fairly easy to calculate into USD (or other fiat currencies), but they are also much less prone to volatility. Because these trades are stablecoin-settled, they act as a shield against volatility in most cases, especially when involving other cryptocurrencies like BTC, ETH, or BNB.
Traders can also expect to enjoy lower fees and maker rebates when using BUSD-margined contracts. Fee discounts apply to any trading pairs such as BTC/BUSD, ETH/BUSD, BNB/BUSD, or any other sort of BUSD perpetual contracts.
Trading BUSD-M Futures with Multi-Assets Mode
Under Multi-Asset Mode, trading BUSD-M contracts can offer more cost-saving benefits.
If you are a BUSD holder, not only can you save on trading fees in the Spot and Margin markets, but you can also save on fees trading the BUSD-M contracts. Furthermore, with Multi-Asset Mode, you can trade USDT-M contracts without converting them to USDT, giving you the flexibility to open positions in both USDT-M and BUSD-M contracts whenever opportunities arise.
If you are a USDT holder, you can save on fees by trading BUSD-M contracts as they offer lower fees and maker rebates, as mentioned earlier. This way, you could reduce your transaction costs and enjoy more profits.
Also, in Multi-Assets Mode, traders can trade in two different directions on the same underlying crypto because they can trade in BUSD or USDT.
For instance, if a trader believed that BTC/BUSD would take a loss due to an upcoming price drop in BTC, they could short a BTC/USDT contract to counteract the potential loss.
So let’s say you held a long-term position valued at 50,000 BUSD in BTC/BUSD perpetual contracts. After some technical analysis, you determine that there is an upcoming downtrend in the near term. By using Multi-Assets mode, hedging for this scenario is simple. The way to bet against BTC and short it would be with a USDT quarterly contract. Your position could simply be to trade half the size of your BUSD position into USDT. In other words, 25,000 USDT worth of BTC/USDT quarterly futures contracts.
Should the price of BTC fall 20%, the losses incurred in BTC/BUSD perpetual would still amount to -10,000 BUSD. Your hedge, however, trading at half the value of your long-term position, would serve to cushion the loss by 5,000 USDT. Thus, although there is still a loss, the risk was mitigated, and in the end, cut down by 50% because BUSD and USDT are linear products, both pegged equally to the US dollar.
Why trade BUSD-margined contracts?
BUSD is a USD-denominated and fully-backed stable coin, pegging each BUSD to 1 USD. BUSD offers faster ways to fund your trades and is acceptable as a medium of exchange, store of value, and payment method across the global crypto ecosystem.
If you hold large sums of stable coins, a split between BUSD and USDT might be a good idea for diversification, convenience, and overall trading strategy purposes.
What happens when you have a large amount of negative balance?
Under the Multi-Assets mode, when the Asset Wallet Balance (total net transfer + realized profits + net funding fee — commissions) is less than a given threshold, all other stable assets in the wallet of the USD-margined future will be automatically converted as margin to cover the deficit. This is also known as Auto Exchange.
How to switch between the Single/Multi-Assets Mode?
Please note that the Multi-Assets Mode only applies to USDⓈ-M Futures. On the USDⓈ-M Futures trading interface, go to the top-right corner and select Preference > Asset Mode.
In the Asset Mode tab, select between Single-Asset Mode or Multi-Assets Mode. Single-Assets Mode is enabled by default.
Do note that if there are open positions or open orders in USDⓈ-M Futures, Multi-Assets Mode cannot be activated.
Similarly, if there are active positions in grid trading, Multi-Asset Mode cannot be activated.
Suppose you are holding positions in Isolated mode. In that case, you will be asked to switch all open positions to Cross Mode before enabling the Multi-Assets function.
When the contract margin assets do not meet the system requirements, they will be automatically converted into other assets under the U-standard contract account as margin assets. Please see the rules of automatic exchange of joint margin.
Before activating Multi-Assets Mode, please read this guide in detail to better manage USDⓈ-M Futures account risk.
How to check your account Margin ratio under Multi-Assets mode?
If you have selected the Multi-Assets Mode, a “Multi-Assets” tag will be indicated on the top-right corner of the Margin Ratio widget.
Since your margin balance is shared across multiple positions in the Multi-Assets Mode, please monitor your margin ratio closely. Once the Margin Ratio reaches 100%, all positions will be liquidated.
Margin Ratio Widget under the Multi-Assets Mode
Following is the equation used to calculate your margin ratio in Multi-Assets Mode:
Account Margin Ratio = Account Maintenance Margin / Account Equity
- Account Maintenance Margin: The sum of maintenance margin of all cross positions in USD.
- Account Equity: The sum of margin balances of all cross positions in USD.
How to check the balance of your assets?
In the trading interface, scroll down to your positions panel and select the Assets tab.
Alternatively, you can check the balance of the assets in your Futures Wallet.