Margin requirements
Before any trade, you post initial margin (IM): collateral that sits against the position for its whole life. CRX sizes it to the ISDA SIMM standard: the same volatility-scaled, ten-day method banks use to margin uncleared FX between themselves, with a hard floor per currency pair. Time: ~4 min.
Why do I post margin at all?
You post margin because it covers the worst likely move before a trade can be unwound, so a close-out is paid from collateral already on the table, never chased after the fact.
You and CRX each put up a deposit before the trade binds. The deposit is sized to the worst the rate is likely to move over the roughly two weeks it could take to close the trade out if one side stops paying. If a move goes against you, the deposit covers it. When the trade settles cleanly, your deposit comes back.
You are not paying a fee, and you are not borrowing. The margin is your own collateral, held and returned. For why both sides post and how the buffer works moment to moment, see Margin & VM (~4 min).
How much do I post?
You post the larger of two numbers: a volatility term and the pair's floor.
imBps = max( vol term , the pair's floor )
(bps = basis points; 100 bps = 1% of the trade.)
- The vol term =
250 · the pair's daily volatility (%) · √10. The√10is the margin period of risk: ten business days, the time it could take to close a trade out when a party is left short. Ten days, volatility-scaled, is the ISDA standard horizon. The vol figure comes live from the price oracle, so the term rises and falls with the market. - The floor is each pair's hard minimum (table below): gap-risk insurance for a currency whose quiet days hide a sudden break that realized volatility cannot price in until after it happens.
Whichever is larger is what you post. The volatility term governs in normal and stressed markets; the floor catches the pair that looks quiet right up to the moment it jumps.
Worked example. A free-floating major moving 0.5% a day posts 250 · 0.5 · √10 ≈ 395 bps, about 3.95% of the trade, well above its 100 bps floor. A tightly pegged currency that barely moves posts its floor instead, because steady realized volatility would otherwise underprice the break risk.
NoteThe maker posts less on the volatility term. CRX uses a coefficient of 250 for you (the taker) and 125 for the maker. When a pair's floor binds, both sides post the same floor.
Why does each currency carry a different floor?
Each currency carries a different floor because gap risk is not the same in every currency. A free-floating major moves continuously, so its volatility term already sees the risk and the floor stays thin. A managed or pegged currency sits still for months and then steps — a devaluation realized volatility cannot price until after the fact — so it carries a thick floor as insurance.
The table below shows the floors, tiered by gap and devaluation risk:
| Tier | Pairs | Floor |
|---|---|---|
| Stablecoins | USDC/USD | 0.25% |
| USDT/USD | 0.50% | |
| Tight peg | USD/HKD | 0.75% |
| Majors | EUR/USD, USD/CAD, USD/SGD | 1.00% |
| GBP/USD, USD/JPY, USD/CHF, AUD/USD, NZD/USD | 1.25% | |
| USD/NOK, USD/SEK | 1.50% | |
| Wider floats | USD/MXN, USD/CNH, USD/KRW, USD/TWD | 2.50% |
| USD/ZAR, USD/BRL | 3.00% | |
| LatAm (session) | USD/CLP, USD/PEN | 4.00% |
| USD/COP | 5.00% | |
| Managed / tail | USD/INR, USD/IDR | 8.00% |
| USD/PHP | 12.00% | |
| USD/TRY | 15.00% | |
| Unlisted | (fallback) | 12.00% |
An unlisted pair is treated as a managed currency until it earns a lower, explicit floor. The floor is the minimum the engine will ever post; the volatility term lifts the number above it as the market warrants.
Can I post less?
No. Every firm posts the same standard margin, with no application and no credit tiers: you sign the standardized ISDA once at onboarding and trade within minutes, even with no banking history. The pair sets the rate, not your balance sheet.
This is the whole credit policy. You rely on no one's creditworthiness, because every position is fully collateralized — and when collateral runs short, the risk engine closes positions.
The Risk Engine · ~3 minthe three moving parts, and what a close-out reaches
What happens when the market moves against me?
Nothing is asked of you. There are no margin calls on CRX: a position is always fully collateralized, and the collateral you already posted absorbs the move.
The shape is the loan-to-value model of overcollateralized lending. A position's account value is your initial margin, plus or minus where the rate has moved since you locked. That value is the position's margin health, shown live on the hedge itself: full at the initial-margin line, falling as a move runs against you, with the maintenance floor — 60% of initial margin as the standard term, signed — as the one line that matters.
Between those two lines, everything is in your hands and nothing is demanded. Fund settlement margin on the hedge deposits collateral and allocates it straight to this agreement, lifting the account value back toward full health. You can do it at any time, at any level — no one asks, and no clock runs.
Only below the maintenance floor does the risk engine act: it closes the position out against the margin already posted, never against you personally, and never reaching your other hedges. The posted margin is the most a close-out can reach.
A position is never called for margin. It is either collateralized, or closed.
The Risk Engine · ~3 minwhat the risk engine closes, and who pays
Is this normal, and is my margin safe?
The answer to both is yes: this is how the business is run, and the design protects your collateral rather than risking it.
- It is the industry standard. The ISDA SIMM method, volatility-scaled over a ten-day margin period of risk, is what regulated institutions use to margin uncleared derivatives with each other. CRX applies the same standard, with a per-pair floor added on top.
- It is your own collateral. Margin is neither a fee nor credit. It sits in a segregated collateral account (SCA) that holds only your initial margin, never lent, never reused, never mixed with profit, and it is returned when the trade settles.
- Both sides post. Each side of the trade puts up margin, so a close-out is paid from the closed-out party's own collateral, never from yours. The book is net-0 by construction: no one carries a directional bet against you.
NoteMargin is never unsecured credit. Every position is fully secured to the IM the engine sets. You never run a deficit, and no one lends you anything.
For where collateral is held and how it is valued, see Collateral (~3 min).
Next: Advanced Settings (~2 min) covers the optional firm and collateral controls.