Cross Margin

In Pinnako, every position is set to isolated margin by default, meaning that risks are not shared across different positions. This allows users to open any number of long and short positions simultaneously for any given pair.

Pinnako also supports cross-margin and compounding, as all positions on the Pinnako exchange are NFT-based. When a new position is opened in Pinnako, an NFT is minted containing all relevant trade metadata, such as size and trading details. All metadata is stored on-chain to maximize decentralization and support compounding and cross-margin functionalities.

Cross Margin

Users can enable cross-margin by opening a cross-margin vault and depositing their positions into it. The vault's value comprises the total collateral balance and the accumulated PnL of all positions in the vault. Once a position is deposited, the total collateral balance and accumulated PnL are updated accordingly.

If the vault loses 97% of its total collateral balance, it will be liquidated, and all positions within the vault will be closed. Any remaining liquidity after liquidation is returned to the vault's owner.

Users can deposit and withdraw positions from the vault at any time, except when immediate liquidation would occur or when the vault fails to maintain the liquidation level upon withdrawing a position.

Since risks are shared across the entire vault, a position can potentially lose more than 100% of its collateral balance, which traders should be cautious about and trade at their own risk. Leverage margin is calculated based on the position's collateral balance, not the entire vault's balance. As a result, a position's leverage remains limited by its collateral balance, even when deposited in the vault.

Cross-margin functionality provides Pinnako's users with greater flexibility in volatile markets and the freedom to share risks across different pairs, such as Forex and Crypto.

Compounding and Partial Close

Users can compound or partially close any open position in Pinnako, regardless of the margin type, at any time without closing and reopening the position.

Traders can compound their position as long as there is sufficient collateral within the chosen leverage. Unrealized profits can also be used as collateral to compound into a larger position size.