Since leveraged trading amplifies your benefits and gains through leverage, Hotcoin evaluates the risk of your leveraged account through the Risk Ratio.

Full Position Mode

Under the Full Position model, users participating in leveraged lending use the net assets in their Hotcoin Full Position account as collateralized assets, and digital assets in other accounts are not counted as collateralized assets in a Full Position leveraged transaction.



Risk Ratio for Full Position Leveraged Accounts = Total Asset Value / (Total Borrowing Value + Total Interest Outstanding)



When the Risk Ratio is >2, users can trade, borrow and lend, and the portion of the account that exceeds 2 times the valuation of liabilities can be transferred to other accounts;



When 1.5 < Risk Ratio ≤ 2, the user can trade and borrow, but cannot transfer assets to other accounts;



When 1.3 < risk ratio ≤ 1.5, the user can only trade, but not borrow or transfer assets to other accounts;

When 1.1 < risk rate ≤ 1.3, a margin call notification will be triggered, and the system will send emails, text messages, and site push notifications to users, and recommend users to add margin to avoid the risk of forced liquidation. After the first notification, push notifications are sent every 24 hours.

When the risk ratio of the leveraged account is ≤ 1.1, the system will execute the process of forced liquidation, which will force the transaction to sell the assets of the leveraged account for repayment. Users will also be notified by sending emails, SMS and webmail push notifications.