The margin trading usefulness

[Oshosondy]

I have not thought of a very good reason of using the margin trading, I prefer the perpetual future. But there are times that the funding rate of a shit coin can increase up to 2/-2%  and it can be as low as 1 hour funding rate. Some people can think of using the margin trading for it in a way they can borrow money and be charged low amount like 0.0003% to 0.00003% every hour.

There was a shit coin that I saw having the high funding rate, I wanted to go for margin trade for the coin, but I did not see the coin. It happened again few days ago which is the second time.

I want to know if anyone have seen funding rate high and want to go in the position that the funding rate will be charged from him every hour, but decided to go for margin trading where the borrowed money charged hours is far lower than the funding rate that would be charged?

When I always go to the margin trading to take advantage of that, I do not see the coins having the high funding rate on the margin spot market.

[Wiwo]

Most exchange knows about the low quality of those coins and that is why they list them on perpetual market and not the spot market, and because of the high risk speculations around those coins on perpetual future market, exchanges choose to give margin rate that is very high perpetual funding rate of 0.2%.

You can't see a margin borrowing rate below 0.0003% per hour which could amount into alot of interest paid on the borrowing.

Even with all of that, most coins that offers that borrowing are always exusted and out of liquidity in the pool, that is the main reason you rarely see that offers on most exchange.

[sergiorus]

I have not thought of a very good reason of using the margin trading, I prefer the perpetual future. But there are times that the funding rate of a shit coin can increase up to 2/-2%  and it can be as low as 1 hour funding rate. Some people can think of using the margin trading for it in a way they can borrow money and be charged low amount like 0.0003% to 0.00003% every hour.

There was a shit coin that I saw having the high funding rate, I wanted to go for margin trade for the coin, but I did not see the coin. It happened again few days ago which is the second time.

I want to know if anyone have seen funding rate high and want to go in the position that the funding rate will be charged from him every hour, but decided to go for margin trading where the borrowed money charged hours is far lower than the funding rate that would be charged?

When I always go to the margin trading to take advantage of that, I do not see the coins having the high funding rate on the margin spot market.

There's no ''funding'' on margin spot market, it is just a borrowing rate, similar to borrowing money from a bank. It's annualised (even though charged every hour or every few minutes) and you can see it on the page where you borrow it. It is also flexible but in case of dollar stablecoins - predictable as it is tied to US T-bill yields.

You can borrow on a CEX or in a DeFi lending app like Aave, wherever fits you better and the rates are more attractive.

The difference with perp trading is that they won't let you borrow at a high leverage, usually like 2x-3x is max you can get because the collateral value must be high enough (their liquidation engines won't differently from perp platforms).

[_act_]

You can't see a margin borrowing rate below 0.0003% per hour which could amount into alot of interest paid on the borrowing.

I have seen as little as 0.00004% before for bitcoin, but I have not seen lower than that before for USDT. Some exchanges will show the rate also on the margin trading account which can let people easily see the percentage that are changed. The percentage is different for each coins. If there is a need to let you know about this, I can look for the exchange and post a screenshot about it.