FAQs

Basics

How long does it take to open an account?

1 minute, maybe quicker, depending on how fast you can type.

What can I deposit on Alpha5?

USDT with further integration options to be made available soon.

What can I trade on Alpha5?

Traders can trade the XBTUSD Perpetual Swap, XBT Futures and XBT Futures Swaps. Parimutuel Options, and other products will be launched shortly thereafter.

What fees are charged?

For trading, Alpha5 has a very simple structure:

  • Perpetual Swaps; Maker: 0 bps, Taker: 5.5 bps
  • Futures; Maker: 0 bps, Taker: 5.5 bps, Futures Settlement: 5 bps
  • Futures Swaps; Maker: 1.75 bps, Taker: 3.75 bps

Any order that does not immediately remove liquidity is classed as a Maker. In addition to keeping inline with industry standards:

  • Futures Settlement Fees: 5 bps
  • Liquidation Fees: 75 bps per order

Withdrawals: None, except for a dynamic minimum network fee.

How do I make a deposit?

In the account page you will find deposit addresses for all applicable cryptocurrencies. When sending a deposit to a particular address please ensure it is for the correct cryptocurrency. A QR code will also be provided. Alpha5 takes no responsibility for any errors or for deposits not arriving.

How do I make a withdrawal?

In the accounts section you can access withdrawals. Please ensure you are withdrawing USDT only to a supported USDT address. Alpha5 takes no responsibility for funds sent to an incorrect address.

Is Two-Factor Authentication necessary?

2FA is not necessary, but it is strongly advised for security purposes. You are able to toggle this preference from within your account.

Is there KYC?

Individual KYC is not mandatory at the moment, but we adhere to strong principles to avoid misuse of the platform. To be eligible you must accept our privacy policy, terms of use, and KYC Policy. You must NOT be a resident of the U.S. or OFAC sanctioned nations.

Alpha5 reserves the right to take any actions, including closure of accounts for violations of these policies.

Are my funds secure?

Yes. A vast majority are stored in multi-signature deep cold storage wallets. Only some funds are held in hot wallets at any time, and are replenished via a proprietary process.

Trading

What is Margin Trading?

Margin Trading allows for the use of leverage. This means that you may trade a higher notional value than what you have available. The amount of funds you have available tends to act as collateral against the value of your position.

The leverage offered on Alpha5 is 25x.

What is Initial Margin?

The Initial Margin is the Margin required to open a position. This is a notional amount that is reserved for each account.

Initial Margin is reserved for all open positions and all open orders, except for orders that would reduce any open positions (where no extra Initial Margin is reserved).

It is calculated simply as: Notional Amount * 1/Leverage

On Alpha5 IM is 4%.

Example:

A trader deposits 1,000 USDT and opens a long position of of 10 BTC 
in the Perpetual Swap with the trade price being 10,000 USDT.

The Initial Margin reserved would be: 10,000*1/25 = 400 USDT. 

Thus, from the 1,000 USDT initially deposited, 600 USDT would be the Available Balance.

What is Maintenance Margin?

Maintenance Margin is the amount of Margin that must be available at all times for a trader to keep full control over their account.

Should the Maintenance Margin drop below a certain level, Alpha5 will begin to partially liquidate any open orders or positions to bring the account back above the Maintenance Margin level.

It is calculated simply as: Notional Amount * Maintenance Margin Threshold.

On Alpha5 the MM threshold is 2%.

Example:

A trader deposits 1000 USDT, and buys 10 BTC in the Perpetual Swap,
at 10,000 USDT.

The Initial Margin reserved is 400 USDT. The MM threshold is 200 USDT. 

Meaning if the account value drops to 200 USDT (10,000 * 2%), liquidations will commence.

What is Cross Margin?

Alpha5 categorizes its margin implementation as Cross Margin. There are various iterations in the market, that are curated with different parameters.

On Alpha5 IM on Perpetual Swaps and Futures is 4%. MM on the same products is 2%. Any Unrealized PnL is immediately available for use and is added to the Available Balance. IM is reserved on every position and on every order. However, any order that is created that would reduce a current position will not be charged IM.

If an account falls below IM, but is still above the MM threshold, it is NOT subject to liquidation. However, in such an instance, a trader can only close positions/orders, or add capital. Below MM, the Alpha5 Risk Engine takes over the account of a trader in an attempt to reduce account exposure to bring Equity > MM.

What is a Liquidation?

A liquidation occurs when an account’s Equity < MM. At this point, a trader does not have control of their account. Alpha5’s Risk Engine takes control of their account to cancel orders and liquidate positions to bring Equity > MM. It is entirely possible that after these liquidation orders a trader has 0 Equity left, in which case they will be bankrupt.

What is the relationship between Equity, Available Balance, and Firepower?

Equity is the total value of the account at any given time. This includes the live PnL of any open positions.

Available Balance is the amount of capital available for deployment. By definition this is the Equity less any IM. Available Balance will also usually be the same as the Withdrawal Balance.

Firepower is a metric that lets you understand how much of your account value is being used; it is the Available Balance/Equity. The higher the number, the less your utilization.

What is Mark Price?

The Mark Price is the price at which the instrument was last measured for purposes of accounting and the risk system. It is typically most referred to in the calculation of Unrealized PnL.

How do I calculate profit and loss?

PnL is calculated for any position as follows:

For a Long Position: Number of Contracts * (Exit Price – Entry Price)

For a Short Position: Number of Contracts * (Entry Price - Exit Price)

What is the difference between UPL and RPL?

Realized PnL (RPL) is any PnL that has accrued from closed positions, trading fees, and funding fees.

Unrealized PnL (UPL) is the running PnL of any open position. It is calibrated to the Mark Price of the instrument. Unrealized PnL is immediately available for use in the trader’s Equity as part of Alpha5’s cross margining offering.