The world of cryptocurrency trading continues to evolve, and one of the most impactful developments for active traders is the expansion of margin options. Starting May 31, 2025, a major shift arrives on BitMEX: Ethereum (ETH) will now serve as both margin and settlement currency for a new suite of derivatives contracts. This change marks a significant step forward for traders who want deeper exposure to the Ethereum ecosystem without relying on stablecoins or Bitcoin.
This guide dives into what ETH-margined contracts are, how they work, and why they matter — especially for traders looking to optimize their leverage, manage risk, and stay fully immersed in native crypto positions.
👉 Discover how ETH-margined trading can boost your strategy today.
What Does Margin Mean in Crypto Trading?
Margin trading allows users to open positions larger than their available account balance by borrowing funds from an exchange like BitMEX. Also known as leveraged trading, this method amplifies both potential profits and risks. Unlike spot trading — where you buy and hold actual assets — margin trading enables directional bets with amplified exposure.
In the context of crypto derivatives, margin refers to the collateral you must deposit to open and maintain a leveraged position. When we refer to an "ETH-margined contract," it means that the contract uses Ethereum (ETH) as both the collateral (margin) and the settlement asset. The value of the contract is still quoted in USD, but no fiat or stablecoin is required at any point.
For example, our new ETH-margined contracts are inverse perpetual swaps and futures, meaning:
- Base currency: ETH
- Quote/nominal currency: USD
- Margin and settlement: ETH
This structure allows you to trade ETH/USD price movements entirely on-chain — no need to convert to USDT or USD. You go long or short on the USD value of ETH while using ETH itself as your backing collateral.
One of the key advantages on BitMEX is that traders don’t need to post 100% of the contract value as margin. Depending on the instrument, leverage of up to 100x is available, letting users control large positions with relatively small amounts of ETH.
Initial Margin vs. Maintenance Margin
Every listed contract specifies two critical thresholds:
- Initial Margin: The minimum amount of ETH required to open a position.
- Maintenance Margin: The minimum amount needed to keep the position open. If your equity falls below this level due to adverse price movement, your position will be liquidated, and you risk losing your remaining margin.
Understanding these values helps you calculate safe position sizes and avoid unexpected liquidations during volatile markets.
Cross Margin vs. Isolated Margin
BitMEX supports two margin modes, giving traders flexibility in risk management:
- Cross Margin: Your entire ETH balance acts as shared collateral across all open ETH-margined positions. The system automatically pulls from your total balance to prevent liquidation. This is the default setting on BitMEX and ideal for diversified strategies.
- Isolated Margin: You allocate a fixed amount of ETH to a specific position. If the margin drops below maintenance level, only that position is liquidated. This mode gives you precise control over risk per trade and allows dynamic leverage adjustment via the trading interface.
👉 Learn how isolated margin can help protect your portfolio from cascading liquidations.
Key Features of ETH-Margined Contracts on BitMEX
Starting May 31, 2025, at 04:00 UTC, BitMEX will launch the following ETH-margined instruments:
- Perpetual Swap: ETHUSD_ETH
Futures Contracts:
- June expiry: ETHUSDM25_ETH
- September expiry: ETHUSDU25_ETH
All contracts feature inverse payoff mechanics, are denominated in USD, and use ETH as margin and settlement. Contract specifications are visible 24 hours before trading begins, so you can review terms in advance.
Once live, these instruments will be accessible through the main trading page under the 🔥 Trending section.
How to Start Trading ETH-Margined Contracts
To begin, you’ll need to deposit ETH into your BitMEX wallet. You can fund your account in several ways:
- Transfer existing ETH from an external wallet
- Buy ETH directly with fiat currency
- Trade other cryptos for ETH via BitMEX Spot
- Use the built-in crypto converter tool
Note: Only ETH can be used as margin for contracts ending in _ETH. These contracts do not accept USDT, XBT, or any other asset as collateral.
Technical Details for Advanced Users
For API traders and developers:
- The settlement currency (ETH) is represented in Gwei (1 ETH = 1,000,000,000 Gwei) within the Instrument data feed.
- This granular unit allows precise handling of small trades and margin calculations.
Additionally:
- The Insurance Fund now includes an ETH component to cover losses during liquidations of ETH-margined positions.
- The fund is segmented by margin currency and rebalanced periodically to ensure platform stability.
Upcoming Listings This Month
The rollout of ETH-margined contracts is just the beginning. BitMEX has a busy schedule ahead:
- June 1, 2025 (04:00 UTC): Launch of XBTN25 monthly futures contract
- June 15, 2025 (04:00 UTC): Introduction of Q3 2025 futures lineup
Stay tuned for more updates as BitMEX expands its derivatives offerings.
Frequently Asked Questions (FAQ)
Q: Can I use USDT or BTC as margin for ETH-margined contracts?
A: No. Only Ethereum (ETH) can be used as margin for contracts labeled with the _ETH suffix.
Q: What happens if my position gets liquidated?
A: If your margin balance falls below the maintenance threshold, your position will be automatically closed. Any remaining collateral may be partially lost depending on market conditions and insurance fund coverage.
Q: Are profits from ETH-margined contracts paid in ETH?
A: Yes. All PnL (profit and loss), funding payments, and settlement occur in ETH.
Q: How is leverage calculated for these contracts?
A: Leverage is determined by your initial margin relative to the notional value of the position. For example, opening a $10,000 position with $100 worth of ETH implies 100x leverage.
Q: Can I switch between cross and isolated margin modes?
A: Yes. Traders can toggle between cross and isolated margin directly in the trading interface before entering a position.
Q: Why trade ETH-margined instead of USDT-margined contracts?
A: ETH-margined contracts allow pure crypto exposure — you never need to exit into stablecoins. This is ideal for long-term holders who want to hedge or speculate without breaking their stack.
👉 Start leveraging your ETH today with advanced derivatives trading tools.