Crypto Trading Binance Margin 2 — Questions and Answers
Question 1: What does the margin level indicator measure on Binance Margin?
- The ratio of total assets to total borrowed plus interest (Correct answer)
- The number of open positions
- The funding rate paid
- The maker fee discount
Correct answer: The ratio of total assets to total borrowed plus interest
Margin level equals total asset value divided by total borrowed plus accrued interest.
Question 2: At what margin level does Binance typically trigger liquidation on cross margin?
- 1.5
- 1.3
- 1.1 (Correct answer)
- 2.0
Correct answer: 1.1
Liquidation is triggered when the margin level falls to 1.1.
Question 3: What is the key difference between cross margin and isolated margin?
- Cross shares the whole account balance as collateral; isolated confines risk to one pair (Correct answer)
- Cross has no interest; isolated does
- Isolated allows higher leverage only on futures
- Cross cannot be liquidated
Correct answer: Cross shares the whole account balance as collateral; isolated confines risk to one pair
Cross margin pools the entire margin balance, while isolated margin restricts collateral and risk to a single trading pair.
Question 4: When you borrow assets on Binance Margin, how is interest generally charged?
- Hourly based on the borrowed amount (Correct answer)
- Only once at borrowing
- Daily flat fee regardless of size
- Never, margin is free
Correct answer: Hourly based on the borrowed amount
Margin interest accrues hourly on the outstanding borrowed amount.
Question 5: What action lets a trader profit from a falling asset price on Binance Margin?
- Short selling by borrowing and selling the asset (Correct answer)
- Staking the asset
- Buying spot only
- Setting a take-profit higher
Correct answer: Short selling by borrowing and selling the asset
Borrowing an asset, selling it, and buying it back cheaper allows profit on a price decline.
Question 6: What happens to borrowed funds and interest when you fully repay a margin loan?
- The debt clears and collateral is freed (Correct answer)
- Interest keeps accruing
- Your account is permanently locked
- The position auto-doubles
Correct answer: The debt clears and collateral is freed
Repaying the principal plus accrued interest closes the loan and releases your collateral.
Question 7: What is the maximum leverage commonly offered on Binance cross margin?
- 3x to 5x (Correct answer)
- 100x
- 50x
- 1x
Correct answer: 3x to 5x
Binance margin trading typically offers up to 3x on cross and up to 10x on isolated for select pairs, far below futures leverage.
Crypto Trading Binance Margin 2
What does the margin level indicator measure on Binance Margin?