Margin funding on Bitfinex goes hand in hand with margin trading. Through margin funding, you can provide funds through the P2P (Peer To Peer) funding platform for traders to use in margin trading and earn interest that is generated! If you are not a trader and prefer safer investments, this feature is for you.
Bitfinex allows you to provide funding in any of our various funding currencies available for margin trading. When you have these funds in your funding wallet, you can then select your own chosen terms (funding rate, duration, and amount) to create a funding offer that will be executed like any order in the order book once it has matched with a bid. You will be paid interest in the rate that you set until the funding taker returns the funds back to you.
Becoming a funding provider on Bitfinex is relevantly of lower risk due to the design of our underlying risk-limiting engine. You can learn more about this here: What are the risks associated with offering funding?
How to earn funding interest?
Step 1: Deposit funds to your funding wallet
To become a funding provider, you will first need to have funds on your Bitfinex account. You can do so by depositing funds directly into your funding wallet.
If you already have funds in your other wallets, you can simply transfer them from one wallet to the other free of charge.
Note: Only currencies which are supported in margin funding will have the option of being deposited to your funding wallet.
For example, the 0Chain token does not support Bitfinex margin trading and margin funding. Therefore deposits to these wallets are not available.
Step 2: Create a funding order
Go to your funding page, and just like creating a trading order, you will also need to create a funding order that will specify the details of your funding offer.
This includes:
- Rate: This is the interest rate that you can manually enter. You can view the current funding market via the funding book;
- Period: This is the duration that you wish to borrow your funds out for, the minimum is two days, and the maximum is 120 days;
- Amount: The number of funds that you will be making available in the current offer.
Alternatively, you can also select FRR (Flash Return Rate), FRR Variable or FRR Fixed for automated rates.
Once you have confirmed your funding offer information, select Offer and your funding offer will be added to the funding order book.
Now your funding offer will need to match a funding bid of the same duration and rate in order for it to execute and begin earning interest.
During this waiting process, you will find your funding order on the funding page in the Bids & Offers widget.
Important: The minimum amount for one offer of funding is $150 USD or the equivalent in other currencies. Therefore any amount lower than this will see an error message when trying to place the offer.
Step 3: Monitor your provided funding
Once your funding offer has matched a bid, it will appear under Provided.
Here you will be able to clearly see the amount you are offering, the rate at which interest will be calculated, and when the funds will return to you.
Note: Once provided, funding cannot be taken back before the time expires. The funding taker, however, can return the funds to you at any time before the funding period ends.
When and where can I see my funding earnings?
Funding earnings are credited every day around 01:30 AM UTC.
You can visit your Reports > Funding Earnings / Ledgers for the specific currency you are lending and review your history of earnings.
Funding earnings in the ledgers report can be identified under entries titled “Margin Funding Payment on wallet funding”.
What are the fees for providing funding?
Funding fees would be 15.0% of the fees generated by the margin funding order, or 18.0% if the funding offer was a hidden order. You can view the details on our fees page.
Note: Fees may differ if you hold a certain amount of UNUS SED LEO. Please view UNUS SED LEO Token Holders Benefits for more details.
Advanced funding at Bitfinex
For more advanced users, then Bitfinex Lending Pro may be the tool you are looking for. Bitfinex Lending Pro is an advanced tool that allows you to set up automated strategies and interact with our peer-to-peer funding market. It is designed to make your lending activities more comfortable and efficient.
To learn more, please view our guideline here: Understanding Lending Pro.
Alternatively, Bitfinex has also integrated third party lending options in the Lending Products page. If you are verified to intermediate level and above, you will have the option of using your Bitfinex crypto holdings to earn interest on these third-party portfolios.
For more information, please view our guidelines here: Lending Products.
If you have any questions regarding margin funding, please feel free to reach out to Bitfinex Support.
