Introduction to CoinEx Loans

What is a CoinEx Loans

CoinEx Loans is a financial service designed to meet your short-term liquidity needs.

Without selling these assets, You can borrow one type of crypto asset by using one or more cryptos as collaterals, and the borrowed assets can be used for trading, investment in financial products, or direct withdrawals.

 

Advantages of CoinEx Loans

1. Introducing "Tiered Collateral Discount" mechanism

CoinEx establishes discounts based on collateral risk profiles to calculate effective collateral value, ensuring market stability and protection against excessive market volatility. This is particularly effective for tokens with moderate market depth, preventing dramatic price fluctuations and providing additional asset security.

 

2. Introducing "Loan Asset Recovery" mechanism

When the lending pool reaches its risk threshold, the system pauses new loans and waits for natural maturity returns. This gentle approach allows the pool to recover to safe levels while avoiding sudden forced liquidations, better protecting your collateral assets.

 

3. Instant arrival and auto-renewal

Borrowed funds are credited immediately after loan initiation, with no waiting period. Auto-renewal is enabled by default at the start of a loan. Every 10 days when the loan term ends, if the platform's liquidity pool supports renewal, the system automatically processes it, preventing unintended liquidations due to oversight or missed deadlines.

 

4. Secure and stable

During technical upgrades of collateral assets (such as rebranding or cross-chain migrations), lending services continue to operate normally, and existing pledged assets remain valid. Additionally, CoinEx injects a portion of daily lending interest income and liquidation fees into an insurance fund to cover potential losses incurred.

 

5. Diverse Collateral

Multiple cryptos are supported as loan collateral. When borrowing a particular crypto, you can use more than one crypto as collateral at the same time, simple and convenient.

 

Key Concepts of CoinEx Loans

1. Loan-to-Value Ratio (LTV)

The Loan-to-Value (LTV) ratio is a key indicator for assessing the risk level of a loan position.

Current LTV = (Value of Assets to be Repaid (Borrowed Assets + Interest) / Value of Collateral Assets) * 100%

After partial repayment, LTV = (Value of Assets to be Repaid - Value of Repaid Assets) / Value of Collateral Assets * 100%

 

2. Discount Rate

The discount rate is set by the risk rate of the collaterals and used to calculate collateral value. Practical collateral value = Collateral market value * Discount rate.

For example, the discount rate of BTC is 90%, and the initial LTV is 70%;

To borrow USDT with a $100 BTC collateral, then:

BTC Effective Collateral Value = 100 * 90% = 90 USDT

Maximum Loan = 90 * 70% = 63 USDT

 

3. Upper Limit of Collateral Value

Each loanable coin has a value limit, meaning, the calculated effective collateral value cannot exceed this limit, regardless of how many cryptos are used as the collaterals.

 

About Automatic Loan Renewal

When users borrow on CoinEx, each new loan generates a loan order, which has a loan term of 10 days (calculated from the creation time of the user's loan order). At the end of the 10-day period, the system supports real-time automatic loan renewal for users.

1. Automatic renewal is enabled by default when borrowing. At the end of the 10-day period, if the platform's liquidity pool can support renewal, it will process the automatic renewal for users in real time.

2. If CoinEx's liquidity pool does not support renewal, the expired order will enter a 7-day grace period, where the automatic renewal is triggered every 24 hours.

If renewal is successful, the process ends. If not, it waits 24 hours before triggering again.

If renewal is still unsuccessful after the 7-day grace period expires, the repayment process is initiated (priority given to repayment from the spot account → if insufficient, forced liquidation of collateral currencies is initiated).

Note: During the grace period, hourly interest is still calculated, with the interest rate based on the user's daily rate from the previous borrowing cycle.

3. Users can choose to disable automatic renewal. At the end of the 10th day, the system will execute repayment from spot balance or forced liquidation of collateral. If users choose to disable automatic renewal when borrowing, they can still choose to enable it after borrowing.

 

About Loan Interest Rates

1. Loan Interest Rates

The overall loan interest rates fluctuate with market conditions and are updated once daily. For specific details, please refer to the "CoinEx Loans" page.

For each new loan, the daily interest rate is set at the current floating rate on the borrowing date and remains fixed for the entire 10-day loan period.

The borrowing interest rate is also affected by your VIP level, please refer to the Borrowing daily interest rate for details.

 

2. Interest Calculation

Once the loan is successful, 1 hour of interest is generated immediately. After that, the interest is calculated at every o'clock based on the to-be-repaid loan amount, without compounding unpaid interest.

  • Initial Interest = Single Loan amount * Daily Interest Rate / 24
  • Subsequent Hourly Interest = Current To-Be-Repaid Loan Amount * Daily Interest Rate / 24

 

3. Others

If a crypto used as collateral for a loan undergoes an airdrop, fork, or other event that generates new assets, the specific rules regarding how those new assets will be handled will be subject to our announcements.

 

Repayment Instructions

1. Repayment Rules

(1) Both full and partial repayments are supported. After partial repayment, the remaining loan amount must meet the minimum borrowing quantity. If this condition is met, repayments are applied to orders chronologically. If not met, the repayment will be rejected.

E.g. User A has two loan orders and wants to repay 1020 USDT partially. The minimum borrow amount is 50 USDT.

  • Order 1000001: 60 USDT borrowed, can be fully repaid, leaving 960 USDT (1020 - 60) for further repayment.
  • Order 1000002: 1000 USDT borrowed. After repaying 960 USDT, 40 USDT would remain, which doesn't meet the 50 USDT minimum threshold.

Therefore, this partial repayment fails as it doesn't meet the requirements.

(2) Repayments are applied to interest first, then principal.
(3) After full repayment, the system returns the user's collateral assets.

 

2. Repayment Methods

(1) Default repayment is to repay with the borrowed coin, i.e. repaying with the same coin that was borrowed.

(2) You can also repay with the collateral. However, this method only supports full repayment, not partial. Your collateral will be systematically swapped to the to-be-repaid assets and directly used for loan repayment until the debt is fully repaid.

 

About Insurance Fund

CoinEx Loans and margin trading share the same insurance fund, which is funded through two sources:

(1) A portion of the daily interest earned on CoinEx Loans and margin borrowing.

(2) The liquidation fees charged from loans or margin liquidation due to falling collateral values.

CoinEx reserves the right to allocate platform revenue towards the insurance fund using alternative methods in the future, apart from those mentioned above.

 

About Forced Liquidation

1. Trigger Conditions

The forced liquidation will be triggered when the current LTV ≥ the liquidation LTV and the system will automatically sell your collateral to repay the loan. Please add collateral in time to avoid forced liquidation.

 

2. Liquidation Rules

(1) Liquidation Order

When there are multiple collaterals, they will be swapped to the borrowed coin in the system-defined order until the debt is fully repaid.

(2) Liquidation Fee

The liquidation fee is calculated and collected after a loan position has been liquidated.

Liquidation fee = To-be-repaid assets (loan + interest) * 2%

It is then converted into quantities of the collateral coins based on the index price. The fee is charged by liquidating the collateral coins in the predefined sequence until the full fee amount has been taken.

The collected liquidation fees are transferred to the insurance fund of the corresponding coin.

  • If the collateral is liquidated due to a failed renewal, no liquidation fee will be charged.
  • If pledged coins are used to repay the loan due to not enabling automatic renewal, no liquidation fee will be charged.

(3) Liquidation Outcome

After liquidation and collecting the liquidation fee, the remaining collateral will be returned, if there is any.

However, when the collaterals are used up, yet the debt is not fully repaid, the insurance fund will automatically cover the repayment. In this case, no liquidation fee will be charged after liquidation.

Disclaimer: The content provided on this website is for informational purposes only and does not constitute investment advice. The information provided is not intended to be a substitute for professional financial advice, consultation, or recommendations. Users are encouraged to consult with a qualified financial advisor before making any investment decisions. The website owners and authors do not assume any liability for any loss or damage that may result from reliance on the information provided. All investments carry risk, and past performance is not indicative of future results.