In futures trading, leverage and the different types of margin (Initial Margin and Maintenance Margin) are core factors that determine position size, risk level, and the liquidation price of a position. Understanding these concepts correctly helps users manage capital more effectively and reduce the risk of unexpected liquidations. 1. What Are Maximum Leverage and Initial Margin? 1.1. Maximum Leverage Leverage in futures trading represents the relationship between the notional value of a position and the amount of initial capital (margin) required to open that position. For example, with 10x leverage, a user only needs to post 1 USDT in margin to open a position worth 10 USDT. Each futures contract is calculated based on its notional position value (Notional Value) , which is the total value of the position converted according to the current market price of the underlying asset. The maximum leverage a user is allowed to use depends on the notional value of the position, specifically: - The larger the notional value of the position, the lower the maximum leverage.- Positions with smaller notional value are usually allowed to use higher leverage. To manage risk, Nami provides a Leverage & Margin table with different levels (tiers). Each tier specifies: - The maximum notional position value - The maximum leverage - The corresponding Maintenance Margin rate and amount. Users can refer to this table for detailed maximum leverage limits and margin requirements for each futures pair. 1.2. Initial Margin and Initial Margin Rate Initial Margin is the minimum amount of capital a user must post in order to open a leveraged position. General formula: Initial Margin = Notional Position Value / Leverage Where: - Initial Margin: The minimum capital required to open a futures position. - Notional Position Value: The total value of the position based on the current market price of the underlying asset.- Leverage: The multiplier between the position value and the initial margin (e.g., 10x, 20x, 125x). Example: If the notional position value is 10,000 USDT and the user selects 10x leverage: Initial Margin ≈ 10,000 / 10 = 1,000 USDT. From this, it is clear that: - Higher leverage → lower Initial Margin required for the same notional value. - Lower leverage → higher Initial Margin required, but the position is generally safer against price fluctuations. Note: Users must select the leverage level first. The system will then calculate the corresponding Initial Margin requirement before allowing the position to be opened. 2. What Is Maintenance Margin? Maintenance Margin is the minimum margin required to keep a position open. The required Maintenance Margin increases or decreases depending on the size of the position. Liquidation occurs when the margin allocated to the position falls below the required Maintenance Margin level. General formula: Maintenance Margin = Maintenance Margin Rate × Position Value Position Value = Position Size × Entry Price Where: - Maintenance Margin: The minimum margin that must be maintained to avoid the position being moved into liquidation. - Maintenance Margin Rate: The percentage rate defined for the corresponding margin tier, used to calculate the Maintenance Margin based on the position value. - Position Value: The monetary value of the position, calculated as position size multiplied by the entry price. - Position Size: The quantity of the asset in the futures position (e.g., 0.5 BTC, 1 BTC, 5,000 units, etc.). - Entry Price: The price at which the user opens the position (in V1K, USDT, etc.). The Maintenance Margin rate applied to a position is determined based on the margin tier corresponding to that position’s notional value. Example: Assume a user opens a long futures position of 1 BTC/V1K at an entry price of 2,500,000 V1K, with 50x leverage (Isolated). - Maintenance Margin Rate: 0.4% - Position Value = 1 × 2,500,000 = 2,500,000 V1K - Initial Margin = 2,500,000 / 50 = 50,000 V1K - Maintenance Margin = 0.4% × 2,500,000 = 10,000 V1K This means the position can withstand an unrealized loss of up to 40,000 V1K (= 50,000 − 10,000) before reaching the Maintenance Margin threshold and being subject to liquidation by the system. Notes - The leverage level selected by the user only affects the Initial Margin. The Maintenance Margin is determined based on the notional value tier of the position and does not directly depend on the chosen leverage (5x, 10x, 20x, etc.). - Nami reserves the right to adjust the Maintenance Margin Rate in response to market conditions (for example, during periods of high volatility or for system risk management purposes). Users are advised to regularly check the Leverage & Margin table for the latest information.