What are the margin requirements on Bybit?

Bybit allows margin trading with USDT or BTC as collateral, offering isolated and cross margin modes to manage leverage from 1x to 100x, impacting risk and liquidation thresholds.

Aug 05, 2025 at 06:42 pm

Understanding Margin in Bybit Trading

Margin trading on Bybit allows users to amplify their trading positions by borrowing funds from the platform. The margin refers to the collateral deposited by traders to open and maintain leveraged positions. This collateral is denominated in cryptocurrency, primarily USDT or BTC, depending on the contract type. Bybit supports both isolated margin and cross margin modes, each affecting how margin is allocated and managed across positions.

In isolated margin mode, the margin is fixed for a specific position. This means the maximum loss is limited to the margin allocated to that trade. If the position moves against the trader, the risk is contained, and liquidation occurs only when the margin is fully depleted. In contrast, cross margin mode uses the entire available balance in the account as margin for all open positions. This increases flexibility but also exposes more of the account to potential liquidation.

The choice between these modes directly influences the effective margin requirements, as isolated mode allows precise control over risk per trade, while cross mode spreads risk across all positions.

Leverage and Its Impact on Margin Requirements

Bybit offers leverage ranging from 1x to 100x, depending on the contract and asset. The selected leverage level inversely affects the required margin: higher leverage reduces the amount of collateral needed to open a position. For example, opening a $10,000 position at 10x leverage requires $1,000 in margin, whereas at 100x leverage, only $100 is needed.

However, higher leverage increases the risk of liquidation due to smaller price movements. Bybit automatically calculates the initial margin based on the leverage and position size. Traders can adjust leverage before opening a position or after, within the limits allowed by the system. It’s crucial to understand that leverage does not change the total exposure—it only changes the margin needed to control that exposure.

Each contract type—USDT-margined or coin-margined (inverse)—has different margin calculations. For USDT-margined contracts, the margin is in USDT, and P&L is also settled in USDT. For BTC-margined inverse contracts, the margin and P&L are in BTC, which introduces additional volatility due to BTC’s price fluctuations.

Initial Margin vs. Maintenance Margin

Two key terms define margin requirements on Bybit: initial margin and maintenance margin. The initial margin is the amount of collateral required to open a leveraged position. This is determined by the leverage selected and the size of the contract. For example, a 10x leveraged position requires an initial margin of 10% of the position value.

The maintenance margin is the minimum amount of collateral that must remain in the position to avoid liquidation. On Bybit, the maintenance margin is typically a small percentage of the position value—often 0.5% for USDT-margined contracts at standard leverage levels. If the equity in the position drops to or below this level due to adverse price movement, the system triggers automatic liquidation.

Traders can monitor their margin ratio in real time on the Bybit interface. When the margin ratio reaches 100%, liquidation begins. Depositing additional margin or reducing position size can increase the buffer against liquidation.

How to Adjust Margin on Open Positions

Bybit allows users to modify the margin allocated to open positions, which is critical for risk management. To adjust margin:

• Navigate to the active positions tab on the trading interface
• Locate the position you wish to modify
• Click on “Add Margin” or “Reduce Margin”
• Enter the amount of USDT or BTC to add or withdraw
• Confirm the action using your authentication method

When adding margin, funds are transferred from your available balance into the position’s isolated margin pool (if in isolated mode). Reducing margin transfers funds back to your available balance, but only if the remaining margin stays above the maintenance threshold. The system will block reductions that would trigger immediate liquidation.

For cross margin mode, adjusting margin is not done per position—instead, the entire account balance serves as collateral. However, traders can still deposit or withdraw funds from the overall account, indirectly affecting the margin available for all positions.

Liquidation Process and Margin Buffer

Liquidation occurs when a position’s equity falls to the maintenance margin level. Bybit uses an insurance fund and a auto-deleveraging system (ADL) to handle liquidations. When liquidation is triggered, the position is closed at the mark price, and any remaining margin is forfeited.

To avoid liquidation, traders can:

• Increase the allocated margin manually
• Set stop-loss orders to limit downside
• Use lower leverage to increase the price buffer
• Monitor funding rates and market volatility

The liquidation price is displayed in real time on the Bybit platform. This price indicates the mark price level at which the position will be liquidated. It shifts as the market moves and as margin is added or removed. Understanding this price helps traders manage their risk effectively.

Frequently Asked Questions

What happens if my position is liquidated on Bybit?

When a position is liquidated, Bybit closes the trade at the current mark price. The system recovers the borrowed funds, and any remaining margin is lost. If the position is closed below the maintenance margin, the insurance fund covers the deficit. In rare cases, the ADL system may take over the position from opposing traders.

Can I change from isolated to cross margin after opening a position?

No, you cannot switch between isolated and cross margin modes after a position is opened. You must close the current position and reopen it under the desired margin mode. This ensures consistency in risk allocation and prevents sudden changes in liquidation risk.

How is maintenance margin calculated for different leverage levels?

Maintenance margin is a fixed percentage of the position value, not directly tied to leverage. For USDT-margined contracts, it’s typically 0.5% regardless of leverage. However, higher leverage reduces the initial margin, making the position more sensitive to price changes and closer to the liquidation point.

Is there a minimum account balance required to trade with margin on Bybit?

Bybit does not enforce a minimum account balance to start margin trading. However, each position must meet the minimum contract size and have sufficient margin to cover both initial and maintenance requirements. For example, the minimum trade size for BTC/USDT perpetual contracts is 0.001 BTC.