What is Cross-Margin?
Cross-margin is a collateral mode where every open position in an account shares a single pooled balance as margin. Unrealized profit on one position automatically offsets losses on another, lowering liquidation risk for the group but exposing the whole balance to a single bad trade.
Cross-margin (or cross margin) is one of the two core margin modes offered by perpetual-futures venues, the other being isolated margin. In cross mode, the exchange treats your entire account balance as backing for all open positions simultaneously. Any unrealized gain on one position raises the effective margin available to every other position, and any unrealized loss draws down the shared pool.
The mechanical difference matters at liquidation. In isolated margin, each position is walled off with a fixed slice of collateral; if that slice is exhausted, only that one position is liquidated and the rest of your account is untouched. In cross-margin, the maintenance-margin check is run against the combined equity of the whole account, so a position only liquidates when the entire pooled balance can no longer support the aggregate maintenance requirement. This makes cross positions far more resistant to being liquidated by a single wick, but a genuinely bad move can cascade and take the full balance.
For funding-rate arbitrage this trade-off is central. A delta-neutral trade holds a long on one venue (or market) and an offsetting short elsewhere to harvest the funding spread while cancelling price exposure. If both legs sit in the same cross-margin account, the long's gain offsets the short's loss tick-for-tick, so the pooled equity barely moves and you can run the pair on much less collateral — high capital efficiency. The cost is containment: an oracle glitch, a bad mark-price, or one leg failing to fill leaves the entire pool exposed rather than capping the damage at one isolated bucket.
Some venues add a third mode, cross-product or portfolio margining, which nets risk across different instruments (e.g. a BTC perp against a BTC-dated future) rather than just pooling collateral. It offers the most capital efficiency of all but concentrates risk most tightly, so it is usually reserved for advanced or institutional accounts.
Practically, arbitrageurs often keep the two legs of a delta-neutral pair in isolated margin on separate venues to guarantee blow-up containment, and reserve cross-margin for legs living on a single venue where the offset is real and same-account. The right choice depends on how correlated your positions are and how much you value efficiency versus a hard loss ceiling.
Worked example: shared collateral in a delta-neutral pair
- •Account balance: 10,000 USDC in cross-margin on one venue.
- •Leg A: LONG 1 BTC perp at 60,000 (notional 60,000).
- •Leg B: SHORT 1 BTC perp at 60,000 on the same account (delta-neutral).
- •BTC drops to 57,000 (-5%).
- •Leg A unrealized PnL: (57,000 - 60,000) x 1 = -3,000 USDC.
- •Leg B unrealized PnL: (60,000 - 57,000) x 1 = +3,000 USDC.
- •Net PnL across the pool: -3,000 + 3,000 = 0. Pooled equity stays 10,000.
- •Because cross-margin nets the two, no liquidation risk from the price move — only funding and fees change equity.
- •Contrast isolated: if each leg held 2,000 USDC of isolated margin, the -3,000 loss on Leg A would exhaust its 2,000 bucket and liquidate it, even though Leg B was up 3,000 in a separate bucket — the offset never applied.
- •Funding still accrues: if funding is +0.01% per 8h, longs pay shorts, so the short leg receives it — that is 0.01% x 3 x 365 = 10.95% APR carry on the 60,000 notional, captured on far less locked collateral thanks to the shared pool.
Cross Margin vs Isolated Margin vs Cross-Product
| Feature | Cross Margin | Isolated Margin | Cross-Product / Portfolio |
|---|---|---|---|
| Collateral | Whole account shared | Fixed per position | Netted across instruments |
| Liquidation trigger | Account equity < total maint. margin | Position margin exhausted | Portfolio equity < netted maint. margin |
| Loss ceiling | Full account balance | Allocated margin only | Full account balance |
| Capital efficiency | High | Low | Highest |
| Offsetting gains help? | Yes, across all positions | No, position isolated | Yes, risk-netted |
| Best for | Correlated / hedged legs | Containing single-position blow-up | Advanced multi-instrument books |
FAQ
What is cross margin in crypto?
Cross margin is a mode where your entire account balance backs all open positions at once, instead of each position holding its own fixed collateral. Profits on one position raise the margin available to others, and a position is only liquidated when the whole account's equity falls below the combined maintenance requirement. It lowers liquidation risk for hedged books but puts the full balance at stake.
What is the difference between cross margin and isolated margin?
Isolated margin walls off a fixed amount of collateral per position, so a liquidation there only loses that slice and the rest of your account is safe. Cross margin pools all collateral, so gains and losses net across positions and liquidation is judged on total account equity. Cross is more capital-efficient and harder to liquidate, but a severe loss can drain the entire balance.
Which is better: isolated margin or cross margin?
Neither is universally better — it depends on your positions. Cross margin suits correlated or hedged trades like delta-neutral funding arbitrage, where offsetting legs cancel out and shared collateral is efficient. Isolated margin is better when you want a hard loss ceiling on a single speculative position, containing any blow-up to its allocated margin.
Can you use both isolated and cross margin at the same time?
On most exchanges, yes — margin mode is usually set per position or per symbol, so you can hold some positions in isolated and others in cross within the same account. A common arbitrage setup keeps a risky directional bet in isolated margin for containment while running hedged, offsetting legs in cross margin for efficiency. Exact behavior varies by venue, so check whether your exchange sets mode per-position or account-wide.
See cross-margin live across 36 exchanges.
Open Funding Screener →