Understanding Coin-Margined Contracts on OKX
Coin-margined contracts (also called inverse contracts) are derivative trading products where the contract value and margin are denominated in the underlying cryptocurrency (e.g., BTC contracts use BTC as collateral). This differs from USDT-margined contracts where all positions are settled in stablecoins.
Key characteristics of OKX's coin-margined offerings:
👉 Discover the advantages of coin-margined trading
- Margin currency matches the traded asset (BTC contracts require BTC collateral)
- Profits/losses settled in the base currency
- Natural hedge for coin holders (reduces exposure to price volatility)
- Traditional crypto futures model (preferred by experienced traders)
Comparing Contract Types: Coin-Margined vs USDT-Margined
The core differences between OKX's contract types:
| Feature | Coin-Margined Contracts | USDT-Margined Contracts |
|---|---|---|
| Collateral Currency | Trading coin (BTC/ETH) | USDT |
| P&L Calculation | In the traded coin | In USDT |
| Best For | Hedging, long-term holds | Day trading, simplicity |
| Price Impact | Higher during volatility | Lower |
Getting Started with OKX Coin-Margined Trading
Step-by-Step Guide:
Account Setup
- Register through official channels (avoid third-party links)
- Complete KYC verification for full platform access
Funding Your Account
- Transfer the required base currency to your futures wallet
- Verify wallet addresses carefully
Placing Your First Trade
- Navigate to Derivatives → Coin-Margined section
- Select appropriate leverage (start with 5x-10x for beginners)
- Set stop-loss orders immediately after position opening
👉 Master advanced trading strategies
Risk Management Essentials
Critical practices for coin-margined traders:
- Position Sizing: Never risk more than 1-2% of capital per trade
- Leverage Discipline: Higher leverage amplifies both gains and losses
- Regular Monitoring: Coin-margined positions require active management
- Diversification: Spread exposure across multiple assets
FAQ: Coin-Margined Trading on OKX
Q: Is coin-margined trading better than USDT contracts?
A: It depends on your strategy. Coin-margined suits long-term holders hedging positions, while USDT contracts offer simpler P&L tracking for active traders.
Q: How does funding work for coin-margined positions?
A: Funding rates apply similarly to other contract types, paid in the traded currency every 8 hours based on market conditions.
Q: Can I switch between contract types easily?
A: Yes, but positions can't be converted—you must close and reopen in your preferred contract type.
Q: What's the minimum investment for coin-margined trading?
A: Varies by coin, but typically 0.01 BTC-equivalent. Check OKX's latest specifications.
Q: How are liquidations handled differently?
A: Coin-margined liquidations occur when your position can't cover maintenance margin in the base currency, requiring closer monitoring during volatility.
Advanced Trading Considerations
Beyond the basics, successful coin-margined traders understand:
- Basis Risk: Price differences between spot and futures markets
- Rollover Costs: Implications for long-term positions
- Tax Implications: Varies by jurisdiction for coin-denominated profits
- Cross-Margin vs Isolated: Risk management approaches
👉 Optimize your trading performance
Remember: Always trade responsibly and never risk more than you can afford to lose. The volatility of crypto markets requires continuous learning and disciplined risk management.