Cross Margin

With Aark Digital’s Peer-to-Pool model, users can trade with cross-margin using any whitelisted assets as collateral. When users deposit ETH, BTC, USDC, or other assets, all assets are quoted in USD but remain in their native form. This allows users to open long/short positions with their collateral and still hodl their assets without impermanent loss. This fundamentally differs from alternative DEXs, where users lose their assets when depositing collateral or mint LP.

In practical terms, this means that a user can open a long/short position with various collateralization ratios. For instance, they could open a position using BTC, ETH, and USDC for a single trade. Traders on our platform can maximize the potential of their capital without the need to sell their assets to open or maintain their positions.

The image below provides an example of multiple collateral options being utilized on our platform. Here, you can see that the account value is $12,574.24, although the collateral consists of $4,000 USDC, 0.25 BTC, and 0.50 ETH.

The margin value is slightly lower because of the weights assigned to BTC and ETH, which are lower than USDC due to their volatility.

The user then opened two long positions on BTC and ETH. You can see that their total position size across both positions is 8x and is in slight profit.

Here, you can see that fluctuations to the account PnL have changed the balances of their account accordingly.

As described above, profit/loss is settled in USDC, so the USDC balance has increased while the BTC and ETH balance has remained the same.

This is just one of many ways that users can utilize cross-margin trading with AARK Digital. In the future, we will extend collateral options to more assets, such as MATIC, ARB, LINK, DOGE, and others, to give users more flexibility.