Margin Trading
What Is Margin Trading?
Section titled “What Is Margin Trading?”Margin trading lets traders increase their market exposure by borrowing against collateral. Instead of limiting a trade to the capital already available in a wallet, a trader deposits an asset as collateral, borrows against it, and uses the borrowed capital to take a larger spot position.
This creates a direct connection between lending and trading. Credit provides the additional buying power, while the spot market determines how that capital is deployed. The position remains tied to the underlying loan, so the trading position and the borrowing position work together.
A simple example makes the relationship clearer. A trader might supply $1,000 worth of XTZ as collateral, borrow $500 in USDT, and use that USDT to buy another $500 worth of XTZ through TEZEX. The trader now has $1,500 of XTZ exposure while carrying $500 of debt. The exact borrowing limits depend on the lending market, but the basic structure is the same: collateral and credit allow the trader to take a larger spot position.
TEZEX + TezFin
Section titled “TEZEX + TezFin”We are bringing those two sides together through TEZEX and TezFin.
TezFin provides the credit layer, where collateral supports borrowing. TEZEX provides the trading layer, where borrowed assets are exchanged into the position the trader wants. Bringing the two together gives us a more integrated margin-trading experience instead of requiring users to move manually between separate lending and exchange workflows.
The same foundation supports more active position management over time. Traders can increase or reduce exposure, change the assets behind a position, repay using collateral, or unwind a leveraged trade through coordinated lending and trading operations.
Expanding the Market
Section titled “Expanding the Market”Margin trading gives existing Tezos liquidity another role in the financial system.
Borrowable assets gain additional demand through trading activity, while spot markets gain more ways for capital to move through them. Holders can also access liquidity and take new positions without necessarily selling the assets they want to keep.
For TEZEX and TezFin, margin trading brings the exchange and credit markets closer together. Trading liquidity becomes useful to borrowers, lending liquidity becomes useful to traders, and the same capital begins to move more freely between the two.