Cryptocurrencies are not legal tender or securities. Cryptocurrency Contracts For Differences (CFDs), which are derivatives of cryptocurrency, are not regulated by the Monetary Authority of Singapore (MAS). Investors should be aware that they will not be entitled to legislative protection when trading cryptocurrency CFDs. If you choose to invest in unregulated products, you will not be protected under MAS regulations. Other risks associated with cryptocurrencies include high price volatility, lack of transparency and cybersecurity risks. Please ensure that you are fully aware of these risks, and if in doubt, you should consult an independent financial adviser. For more information on cryptocurrencies, their derivatives and associated risks, please refer to the MoneySense website here.

CFDs on Cryptocurrencies - Margin Increase to a minimum floor of 50%

On 26th June 2020 (10pm UK time), the minimum margin on all CFDs on Cryptocurrencies trades will increase to a minimum floor of 50% on existing and new positions. This will also remove any margin reductions that you might have while using Guaranteed and Non Guaranteed Stops. This margin change is a regulatory requirement and applies to all MAS regulated brokers in Singapore.

The margin rate that we will be referencing is pegged to a variable margin rate on the similar underlying futures offered by an Approved Exchange (ICE Futures Singapore Pte Ltd) in Singapore. Hence, please note that margins will be updated on the 1st business day of each month and also on an ad hoc basis depending on the volatility of the market for existing and new positions.

It is important that you keep your account sufficiently funded to avoid a margin call close out.

Please refer to the below for an illustrative breakdown of the margin calculation:

1.5 (multiplier) X margin rate offered by ICE Futures Singapore Pte Ltd = X%

The margin rate that we will use is X% or 50% whichever is higher.

An example

Variable margin rate offered by ICE Futures Singapore Pte Ltd : 35%

Total margin required: 1.5 (multiplier) X 35% = 53% (rounded up) – we will take 53% as the margin as it is above the minimum 50%

You buy 1 contract of CFD on Bitcoin (USD $1) CFD, at price 5200

1 contract x USD 1 x 5200 x 53% = USD 2756

As an Accredited Investor, your margin required will be based on the variable margin rate offered by ICE Futures Singapore Pte Ltd on the similar underlying futures

Variable margin rate offered by ICE Futures Singapore Pte Ltd : 35%

You buy 1 contract of Bitcoin (USD $1) CFD, at price 5200

1 contract x USD 1 x 5200 x 35% = USD 1820

Margin Call and Funding your account

Cryptocurrencies markets close at 10pm on Friday night (UK time), then reopen on Saturday at 4am (UK time). Please note that your account can go on margin call during the weekends as the cryptocurrencies market is open.

When your available funds goes below 0, that is when your account starts to be on margin call. When your account is on margin call, positions are at risk of being liquidated due to the following scenarios:

1. If your equity drops below 50% of your margin requirement
2. If your account remains on margin call constantly for 48 hours

Please monitor your positions when your account is on a margin call. You may do the following when your account is on a margin call:

1. Close out positions such that your available funds do not remain negative
2. Choose to top up funds to your account to hold on to your position.

For IMMEDIATE funding, you may do a card deposit which is the only mode of deposit that is instantaneous to prevent positions being closed due to margin call. You may do a card deposit by logging in to the web-based platform or mobile app.

For more information on our margin call policy, please visit here.

For more information about funding methods, please visit here.