On Bitfinex, when you claim an existing position (e.g., a long BTCUSDt position) your wallet gets credited the number of BTC you were long, whilst simultaneously debiting your wallets by the USDt value of that position (Qty * base price). The value of the overall account does not change nor does exposure to each asset - which will have a long exposure and a short exposure that remains constant. The only change here is from an accounting perspective, your wallet balances have now been adjusted to reflect the position being transferred.
The Increase Position function for our Borrow feature now allows you to do the opposite of this process. This is useful not only in the case of reinstating a prior position that was claimed accidentally but also as a way of enhancing your liquidity profile, without the need to trade in or out of these positions.
Increase Position allows you to keep your desired exposure to an asset e.g. BTC. However, by transferring this exposure from your wallet to an open position, the wallet is now credited with USDt which is borrowed from the P2P lending market. These funds can then be utilised for other trading strategies or withdrawn (up to a certain %) for other purposes, such as for use on other venues.
Increase Position is also a quick and a more advanced way to connect to our Borrow feature. This allows you to quickly and easily borrow the funds you would like to remove from the P2P lending market with no additional trading needed. This will save you the trouble of creating orders while only paying maker fees. Also note that the Increase Position function is only available to verified users.
To begin:
You can choose to “Increase Position” directly from your “POSITIONS” widget, this will allow you to open a new position or increase an already opened position in either a long or a short direction, depending on the positions you already have and the trading pair of choice.
1. First choose the trading pair from the provided list, note that this list only contains the supported pairs available on Bitfinex Borrow.
2. Choose if you wish to open a long or a short position.
A long position will be using the quote currency as collateral, while a short position would be using the base currency.
In the case of BTC/USDt, for a long position you would borrow USDt with BTC, so if you have 1 BTC and 0 USDt, clicking on Increase Position would create a long position for 1 BTC and you would get 14400 USDt (assuming market price is 18000 USDt, maximum borrowing is 80%) on your margin wallet.
In the case of a short position, assuming you have 22500 USDt and 0 BTC, increasing the position would take the 22500 USDt and use it as collateral for a short position (or borrowing) of which you would receive 1 BTC on your margin wallet (assuming market price is 18000 USDt).
Note that the above calculations are only an estimation.
3. Please note that only one position can be opened for a single trading pair. Therefore If you already have a position open, the system will automatically pre-select the direction for you and an error message will appear if you try to continue in the opposite direction.
For more details please view: Can I open multiple margin trading positions for the same pair?
Note that some trading pairs may only be available in either a long or short position.
4. You will finally need to enter the amount of the position you wish to create or increase in, note that the amount should be in the base currency of the trading pair. Note that there is a maximum and minimum allowed amount, this information can be found in our API documentation here: https://api.bitfinex.com/v2/conf/pub:spec:pos_increase
5. Once you click on “Proceed” your position will be created or increased, you will see it in your “POSITIONS” widget on the trading page. The funds will be made available for you in your margin wallet, available for withdrawal or for trading.
For more information on interest rates, collateral and relevant fees, please view the Bitfinex Borrow article.
