A Guide to Bybit Margin Trading 2021

Estimated reading time: 14 minutes

In this article, we will be talking about margin trading at the Bybit exchange. Bybit offers its services in perpetual contracts. We will guide you through steps for margin trading at Bybit while explaining all the platform features.

Summary (TL;DR)

  • Bybit only offers margin trading, therefore Bybit is optimized for it.
  • You can open positions with margin and then use leverage to increase your capital.
  • Bybit offers three contract options, i.e., Inverse perpetual, USDT perpetual, and Inverse futures.
  • It is one of the few crypto margin exchanges to offer both cross and isolated margin trading.
  • There is maximum leverage of 100x, and it is non-adjustable in the case of cross-margin mode.
  • The exchange provides many features such as conditional mode, leverage slider, maintenance margin, hedge mode, etc.
  • The exchange charges a high taker’s fee; however, they also pay a maker’s rebate.

What is Bybit margin trading?

Margin trading is popular due to its flexibility and higher returns with lower capital. At Bybit, you can use leverage to multiply the returns you gain from margin trading. However, if the market goes sideways, you can also incur huge losses.

How does margin trading at Bybit work?

After you have funds in your Bybit wallet, you can go to the margin trading tab and go long/ short. On entering your margin amount or collateral and then setting the leverage, the platform automatically provides the funds to open a position. 

Contract options

Bybit provides margin trading in three different contract options:

1. Inverse perpetual

Bybit offers inverse perpetual contracts in BTCUSD, ETHUSD, EOSUSD, and XRPUSD. The BTC or any other asset will be your base currency, and you need to own that asset to use inverse perpetual.

Suppose if you don’t own ETH, then you cannot trade ETHUSD perpetual contracts. However, Bybit offers an asset exchange function to exchange an asset you possess for ETH and then use ETHUSD perpetual contract.

2. USDT perpetual

Bybit offers a USDT perpetual contract in BTCUSDT, ETHUSDT, LINKUSDT, BCHUSDT, etc. Bybit margin trading uses a linear contract in USDT. USDT perpetual contract uses stablecoin as margin, and hence you don’t need to hedge positions.

3. Inverse futures

Bybit has recently launched its inverse futures contract in BTCUSD0625 and is coming up with another contract, BTCUSD0924, soon. You can use one BTC margin trading account across BTCUSD perpetual and futures contracts.

Bybit Contracts
Bybit Contracts

Bybit isolated margin trading

The isolated margin at Bybit puts only the funds of that particular position at risk. In case the market goes sideways, you’ll have to add more funds or might need to suffer liquidation. However, in the case of liquidations, the exchange won’t deduct funds from your original account balance.

Bybit cross margin trading

Cross margin at Bybit uses all of the users’ account balances to prevent liquidations. If the market goes sideways, then cross-margin trading can cost you more than your initial capital. If the equity of the trading pair goes lower than the maintenance margin, then liquidations occur. 

Leverage at Bybit

Bybit offers maximum leverage of 100x on the cross and isolated margin trading. You can change the leverage of isolated margin trading from the slider provided; however, there is fixed leverage of 100x on cross margin trading.

The candlestick chart

Bybit offers a customizable candlestick chart with features like XABCD, Long Position, Pitchfork, etc. You can easily customize the chart using the settings button in the candlestick chart’s top right corner.

Bybit Charting

Features of the margin trading tab

There are many features on the margin trading tab of Bybit, and almost all of them are as below:

Limit Order

Limit orders allow you to set a limit price, and then the order will execute when the limit price is met. The limit can also lead your order never to complete if your requirements are never satisfied by the market.

Market Order

Market orders allow you to open positions in real-time, and your orders execute with the best price in the order book. You can use them for entering or exiting fast-moving markets.

Market Order
Market Order

Conditional Order

These are advanced order which only meets when the market reaches a trigger price. When the order requirements are met, the order’s place fils immediately. A conditional limit order is placed in the order book. This limit order will execute when the market reaches its preset price.

Bybit Conditional Order
Bybit Conditional Order

Close on trigger

Close on the trigger is only available in conditional orders. This option guarantees the execution of your stop-loss orders even if you have an insufficient margin.