Crypto on Credit is a financial service that allows traders to borrow assets and increase their trading volumes. This guide explains its core mechanics, benefits, and common user questions.
How Crypto on Credit Works
Crypto on Credit enables you to trade cryptocurrencies using borrowed funds. This service helps you leverage your positions and potentially increase returns. To begin, you need to transfer collateral from your Spot Wallet to your dedicated Credit Wallet.
Understanding Your Wallets
Your account has two main wallets when using this service:
- Spot Wallet: Holds your initial PHP and cryptocurrency funds.
- Credit Wallet: Created automatically for Crypto on Credit; used to manage borrowed assets and collateral.
Your Total Balance displayed on the Portfolio tab reflects the combined value of both wallets.
Applying for a Loan and Managing Credit
How to Apply for a Loan
To borrow assets:
- Navigate to the 'Credit' tab on the platform's website.
- Select the assets you wish to borrow.
- Transfer funds from your Spot Wallet to your Credit Wallet to serve as collateral.
Increasing Your Credit Limit
New users often start with a 0.00 credit limit. To increase it:
- Click the Increase credit button.
- Transfer more funds from your Spot Wallet to your Credit Wallet to add collateral.
Your maximum borrowing power is directly influenced by the amount of collateral you provide. You can often borrow more than the value of your transferred collateral, depending on the platform's terms.
Collateral Explained
How Collateral is Handled
When you provide collateral (e.g., PHP 10,000), the process is straightforward:
- Collateral Transfer: Funds move from your Spot Wallet to your Credit Wallet.
- Collateral Lock: The collateral remains locked while your loan is active.
- Collateral Return: Once you fully repay the loan and any accrued interest, the remaining collateral is returned to your Credit Wallet.
The full return of your collateral is contingent on the complete repayment of the loan. Market fluctuations can affect the value of crypto-backed collateral, which may impact the amount ultimately returned.
Interest Rates and Fees
Interest accrues hourly from the moment the loan is disbursed. Rates are fixed and vary by asset:
- Bitcoin (BTC)-collateralized loans: 0.008% per hour
- PHP-collateralized loans: 0.005% per hour (Note: Promotional rates may apply for a limited time)
- New tokens (ETH, SOL, XRP): 0.003% per hour
Interest is compounded hourly for repayment calculations. Always check the latest rates on the platform, as promotional offers can change.
Repaying Your Loan
You have two flexible options to repay your loan:
- Direct Repay: Use the existing balance in your Credit Wallet to pay down the liability.
- Transfer & Repay: Move funds from your Spot Wallet to your Credit Wallet to facilitate repayment.
There are no fixed monthly installments or strict due dates. However, you must monitor your Liquidity Rate to ensure it stays above the minimum threshold (e.g., 10%) to avoid automatic liquidation.
Trading with Borrowed Funds
To start trading with your loan:
- Go to the Trade panel within the Credit tab.
- Select from the available trading pairs designed for Crypto on Credit.
- Execute your trades, such as buying long or short positions.
👉 Explore advanced trading strategies
Managing Your Funds and Liquidation
The Liquidation Rate
Your position faces liquidation if the value of your collateral falls too low to cover your liabilities. This is known as hitting the liquidation rate. Maintaining a healthy cushion above this threshold is critical to avoid forced closure of your positions.
Transferring and Withdrawing Funds
- Loan Proceeds: Directly withdrawing borrowed funds to your Spot Wallet or an external wallet is typically restricted. These funds are intended for trading within the system.
- Trading Proceeds: To withdraw profits, you must first transfer them from your Credit Wallet to your Spot Wallet. From there, you can cash out PHP or withdraw cryptocurrency as usual.
Be aware that transferring funds out of your Credit Wallet can affect your Risk Rate, as it may reduce your available collateral.
Platform Availability and Eligibility
Where to Access the Service
As of early 2025, all transaction functions for Crypto on Credit are available on the website. You can check your balances and monitor your positions on the mobile app, but trading actions require web access.
Eligibility Requirements
This service is available to users who have completed standard Identity (ID) and Selfie Verification procedures. There is no requirement for an "Enhanced Verification" tier to enroll.
Frequently Asked Questions
How is the interest on my loan calculated?
Interest is calculated hourly and compounded. The rate depends on the collateral asset, ranging from 0.003% to 0.008% per hour. Always check for the latest promotional rates on the official platform.
What happens if the market moves against my position?
If the value of your collateral drops significantly, your Risk Rate increases. If it falls below the maintenance threshold (e.g., 10%), your position may be liquidated to repay the loan, potentially resulting in a loss of your collateral.
Can I use any cryptocurrency as collateral?
No, only specific cryptocurrencies and PHP are accepted as collateral. The list of supported assets is available on the platform's official support pages, which include major tokens like BTC, ETH, SOL, and XRP.
How quickly do I need to repay the loan?
There is no fixed repayment term. You can hold the loan as long as you maintain a healthy Risk Rate above the liquidation threshold. However, remember that interest accrues hourly, increasing your total liability over time.
Is my collateral safe?
Your collateral is held securely but is subject to market risk. Its value can fluctuate. It is returned in full only after the loan and all accrued interest are completely repaid, provided the value was maintained.
Where can I learn more about managing risk with leveraged trading?
It is crucial to understand the risks of trading with leverage. 👉 Learn more about risk management tools
Conclusion
Crypto on Credit is a powerful tool for experienced traders looking to amplify their strategies. By understanding how collateral, interest, and liquidation work, you can use borrowed funds more effectively. Always prioritize risk management to protect your capital while exploring these advanced financial instruments.