Margin and Derivatives Trading Agreement - OKX Middle East Fintech FZE

Section 1 - Introduction

1. Scope

1.1 This Agreement applies to all Services that OKX Middle East Fintech FZE (“OKX” or “we”) offer to you (“User” or “you”) through the Platform.

1.2 The Services that we offer are set out and described in Section 2 of this Agreement.

2. Applicability

2.1 This Agreement, as amended from time to time, supplements and is in addition to the Terms of Service. It is intended to be read in conjunction with the Terms of Service.

2.2 The provisions set out in the Terms of Service shall continue to apply to this Agreement and are incorporated by reference and shall be deemed to have the same force and effect as if set out in full in this Agreement. 

2.3 Unless otherwise defined in Schedule 1 of this Agreement, any capitalised terms used in the Terms of Service shall have the same meaning in this Agreement.

2.4 In the event of any conflict or inconsistency between this Agreement and the Terms of Service this Agreement shall prevail.

3. Classification

3.1 In offering and making available to you the Services, we have classified you as either:

(a) a Qualified Investor; or

(b) an Institutional Investor,

in accordance with the VARA Rules.

3.2 Users are required to immediately inform OKX Dubai of any circumstances which would affect the Users’ client classification.

4. Acceptance

4.1 By using the Services, Users accept and agree to be bound by the provisions set out in this Agreement and acknowledge and accept the risks involved.

Section 2 - The Services

5. The Services

5.1 OKX may offer the User the following Services on the Platform:

(a) Margin Trading;

(b) Futures Contracts;

(c) Options Contracts; and

(d) Perpetual Contracts.

6. Margin Trading

6.1 A User may undertake Margin Trading by placing an order through the Platform. 

6.2 To undertake Margin Trading on the Platform the User must deposit Virtual Assets or Fiat with OKX to be held as Margin.

6.3 OKX shall use the deposit from the User referred to in Clause 6.2 as security against any potential losses the User may incur as a result of the User’s use of the Platform. 

6.4 OKX may offer the User Leverage for the purpose of trading on the Platform. 

6.5 The Leverage extended to a User shall be expressed as a multiple of the amount of Virtual Assets that the User provides to trade. 

6.6 OKX shall take all reasonable steps to ensure that the amount of Leverage offered to the User is displayed on the User’s Trading Account.

6.7 OKX retains sole discretion as to the amount of Leverage that it may offer a User. 

6.8 The maximum amount of Leverage shall be subject to Applicable Law. 

6.9 OKX retains the right to withdraw or vary the amount of Leverage it has offered a User at its sole discretion.

6.10 In the event that OKX withdraws or varies the Leverage amount, it shall notify the User within a reasonable period by updating the Leverage amount displayed on the User’s Trading Account. 

6.11 When a Margin trade is filled, a User must pay interest on the amount of Virtual Assets that are borrowed by the User.

6.12 Details of the interest rate are set out on: https://www.okx.com/fees/margin 

7. Futures Contract

7.1 A User may trade a Futures Contract by placing an Order through the Platform. 

7.2 Users may find the Contract Specifications for each Futures Contract at the following link https://www.okx.com/help/i-future-contracts.

7.3 OKX Dubai may amend the Contract Specifications from time to time. In the event that the Contract Specifications are amended, OKX Dubai shall notify Users through one or more of email, the Website or the Platform.

7.4 In order to trade a Futures Contract on the Platform a User must agree to enter into a Futures Contract to buy or sell a specified Virtual Asset with another User:

(a) for a specified price; and

(b) at a specified date on which the Futures Contract will expire and on which the underlying Virtual Asset will be delivered.

7.5 OKX shall take all reasonable steps to provide the User with access to the Platform for the purposes of enabling the User to enter a Futures Contract. 

7.6 OKX shall cancel open orders of any expired Futures Contracts at the time of settlement. 

7.7 OKX shall ensure that Futures Contracts are settled on Friday at 12:00pm on the week of delivery.

7.8 The time referred to in Clause 7.7 above shall be United Arab Emirates time.

8. Options Contract

8.1 A User may trade an Options Contract by placing an Order through the Platform.

8.2 Users may find the Contract Specifications for each Options Contract at the following link https://www.okx.com/help/i-okx-options-introduction.

8.3 OKX Dubai may amend the Contract Specifications from time to time. In the event that the Contract Specifications are amended, OKX Dubai shall notify Users through one or more of email, the Website or the Platform.

8.4 An Options Contract purchased through the Platform may permit the User, as the Options Contract holder, to exercise the Options Contract only on the expiration date of the Options Contract. 

8.5 When a User enters into an Options Contract on the Platform, it shall be deemed an Options Contract Holder.

8.6 When the User is the Options Contract Holder it may:

(a) close the Options Contract position prior to expiry; or

(b) wait till the relevant expiry date. 

8.7 On expiry, an Options Contract shall be automatically exercised by OKX if it is in-the-money and shall not be automatically exercised by OKX if it is out-of-the-money.

8.8 If the User, when it is the Options Contract Holder, wishes to exercise its right under the Options Contract to purchase the underlying Virtual Asset, the counterparty (the User selling the Options Contract) must settle the underlying transaction in the relevant Virtual Asset. 

8.9 In settling the underlying transaction under Clause 8.7 the counterparty shall have the obligation to buy or sell, as the case may be, the underlying Virtual Assets at the agreed price.

9. Perpetual Contract

9.1 A User may trade Perpetual Contracts by placing an Order through the Platform.

9.2 Users may find the Contract Specifications for each Perpetual Contract at the following link https://www.okx.com/help/i-perpetual-swaps.

9.3 OKX Dubai may amend the Contract Specifications from time to time. In the event that the Contract Specifications are amended, OKX Dubai shall notify Users through one or more of email, the Website or the Platform.

9.4 OKX shall take all reasonable steps to provide the User with access to the Platform for the purpose of trading a Perpetual Contract.

9.5 By trading a Perpetual Contract on the Platform, a User shall enter into a contract with another User that:

(a) does not have an expiration date;

(b) has no settlement price; and

(c) contains a Funding Rate.

9.6 Details regarding the Funding Rate can be found on the following link: https://www.okx.com/help/iv-introduction-to-perpetual-swap-funding-fee.

9.7 The Funding Rate differs for each Perpetual Contract and OKX shall inform Users of any updates to the Funding Rate calculation through one or more of email, the Website or the Platform.

9.8 OKX shall be solely responsible for calculating the Funding Rate. As a result of the calculation, Users may owe sums to other Users in accordance with Clause 9.8 below.

9.9 Upon calculation of the Funding Rate, Users with long positions:

(a) shall owe sums to Users with short positions when the value of Funding Rate is positive; and

(b) shall be owed sums by Users with short positions when the value of the Funding Rate is negative.

9.10 OKX shall be solely responsible for settling dues between Users in accordance with Clause 9.8 above and shall do so promptly in accordance with the Funding Rate settlement cycle. 

9.11 OKX shall take all reasonable steps to ensure that a Funding Rate settlement cycle is made every 8 hours, at:

(a) 04:00;

(b) 12:00; and 

(c) 20:00. 

9.12 The Funding Rate settlement frequency may differ for different Perpetual Contracts. OKX shall be responsible for informing users for any updates to the Funding Rate settlement frequency. 

9.13 All times in Clause 9.11 (a) to (c) above are references to United Arab Emirates Time.

Section 3 - Fees and Payments

10. Fees

10.1 OKX may charge a User a fee each time a Position is opened, closed and/or liquidated. 

10.2 By opening, closing or liquidating a Position a User agrees to incur and pay OKX any such fees. 

10.3 A list of fees that may be incurred by a User, including but not limited to a trading fee, funding fee and a settlement fee is available on OKX’s website at the following link https://www.okx.com/fees. 

10.4 OKX may update its fees from time to time.

11. Taxes

11.1 Subject to Applicable Law, OKX may be required to charge a User tax, including but not limited to Value Added Tax.

11.2 OKX shall set out the rate of any tax in its invoice to a User. The rate of tax is subject to change.

11.3 Any tax charged to a User by OKX will be in addition to its fees and commissions. By using the Services, a User agrees to incur and pay OKX the tax.

Section 4 - Trading

12. Trading Account

12.1 In order to use the Services, a User must fund its Trading Account with Virtual Assets. 

12.2 OKX shall take all reasonable steps to ensure that a User’s Trading Account shall provide the User with a real time order book of our Services regarding specified Virtual Assets. 

12.3 You understand that we shall only provide you Services on specified Virtual Assets as communicated to you through the Platform from time to time. We reserve the right to amend the list of specified Virtual Assets at any time at our sole discretion.

12.4 OKX is responsible for, and shall take all reasonable steps, to match any Positions a User opens with another User.

12.5 In using the Services, you shall be offered three types of Modes on your Trading Account as follows:

(a) Single Currency Margin Mode; 

(b) Multi Currency Margin Mode; and

(c) Portfolio Margin Mode.

12.6 In Single Currency Mode, OKX shall take all reasonable steps to ensure that all settlements, Margin and liquidations shall be isolated to the particular Virtual Asset the User is trading with.

12.7 In Multi Currency Mode:

(a) all the Virtual Assets in a User’s Product Trading Account shall, for the purposes of calculation only, be converted to USD equivalent as a shared Margin;

(b) any profits and losses incurred by a User shall not be limited to a single Virtual Asset, or a single Position.

12.8 In Portfolio Margin Mode:

(a) all of a User’s Positions with the same underlying Virtual Asset are grouped into risk units for the purposes of calculating Maintenance Margin requirements; and

(b) OKX will consider Margin holistically within a risk unit. 

12.9 OKX shall limit the availability of Multi Currency Mode and Portfolio Margin Mode to Users that maintain a net equity in their Account of at least USD 10,000.

12.10 When placing an order, a User may opt for Isolated Margin to restrict the amount of margin allocated to each position. OKX may make this option available for all Modes.

12.11 Further details regarding these modes are available on our website on https://www.okx.com/help-center/category/product-documentation. 

13. Trading for Margin Trading

13.1 This Clause 13 shall only apply to the Margin Trading Product.

Opening a Position

13.2 Users may open a Position by either selecting ‘buy’ or ‘sell’ on the Platform for the relevant Virtual Asset.

13.3 Users shall be required to provide Initial Margin to open a Position. The amount of Initial Margin may vary. 

Maintaining a Position

13.4 For as long as the Position remains open, Users shall be required to provide Maintenance Margin to prevent the Position from being liquidated. The amount of Maintenance Margin required shall depend on the size of a User’s Position and its mark price or entry price and is subject to change at OKX’s discretion. Initial Margin and Maintenance Margin may be deposited in Virtual Assets or fiat.

13.5 Once a User has opened a Position, the User is solely responsible for reviewing their Maintenance Margin requirements to ensure that this meets the minimum Maintenance Margin, which may fluctuate.

13.6 OKX Dubai shall automatically reflect any variations in Maintenance Margin on the User’s Trading Account. 

Closing a Position

13.7 When a User closes a Position, OKX shall reflect realized Profit and Loss on the User’s Account. 

13.8 Subject to your obligations regarding Maintenance Margin, you may close your Position through the Platform at any time you wish.

13.9 When you close your Positions, subject to any fees, the profit or loss shall be credited or debited to your Trading Account.

14. Trading for Derivative Products

14.1 This Clause 14 shall only apply to the Derivative Products.

Opening a Position

14.2 A User may open a Position by placing an Order through the Platform for the relevant Derivative Product.

14.3 Users shall be required to provide Initial Margin to open a Position. The amount of Initial Margin may vary.

14.4 When an Order is placed, OKX Dubai shall undertake best efforts to promptly match a User’s Order with one or more Orders submitted by other Users subject to the Initial Margin requirement being met.

14.5 OKX Dubai does not guarantee that an Order shall be matched instantaneously. Users agree and accept that there may be delays in matching orders subject to market conditions.

14.6 When an Order is matched, the User shall enter into a Contract with another User subject to the relevant Contract Specifications. OKX Dubai shall not be a party to the contract.

14.7 By entering into a Contract, Users are deemed to have accepted and understood the relevant Contract Specifications applicable to their Contract.

Maintaining a Position

14.8 Users shall be required to Maintenance Margin to prevent the Contract from being liquidated.

14.9 The amount of Maintenance Margin required may vary for each Contract and is subject to change at OKX’s discretion.

14.10 A User is solely responsible for reviewing their Maintenance Margin requirements to ensure that it meets the minimum Maintenance Margin, which may fluctuate.

14.11 OKX Dubai shall automatically reflect any variations in Maintenance Margin on the User’s Trading Account. 

Settlement

14.12 Subject to the provisions of this Agreement, all Contracts shall settle in accordance with the Contract Specifications as amended from time to time.

14.13 OKX Dubai shall be solely responsible for determining the relevant profit and loss for each User at the time of settlement.

14.14 Users agree that any calculations made by OKX Dubai in respect of settlement are final and conclusive.

15. Early Warning Notification

15.1 Your Trading Account shall display a metric referred to as the Margin Ratio. This is a ratio of your equity and Maintenance Margin. The Margin Ratio expresses the overall “health” of your Trading Account and whether there is a risk of liquidation. The higher the Margin Ratio the better the “health” of your Trading Account.

15.2 OKX shall take all reasonable steps to ensure that you are provided with an Early Warning Notification when your Margin Ratio goes below a certain ratio. We have by default set the ratio when your Margin Ratio goes below 300%. 

15.3 Users may configure their applicable Margin Ratio to either 150% or 200% at their own risk.

15.4 When you register with OKX you will be requested to select a preferred method of communication. You shall receive the Early Warning Notification through your preferred method of communication. OKX is not responsible if you are not able to access, or have changed, your preferred method of communication at the time an Early Warning Notification is sent to you. 

15.5 When you receive an Early Warning Notification, you are strongly encouraged to provide further Virtual Assets in your Trading Account to maintain a healthy Margin Ratio.

15.6 In all cases, it is your responsibility to properly monitor your Margin Ratio and applicable Maintenance Margin to ensure that your Position is not liquidated.

16. Withdrawals

16.1 Users may withdraw amounts from your Trading Account provided that the amount does not result in a decrease of their Margin obligations. 

Section 5 - Liquidation and Insurance Fund 

17. Liquidation

17.1 We reserve the right to fully or partially liquidate your Trading Account for any reason whatsoever. 

17.2 We may liquidate your Trading Account under Clause 17.1 at any time where your Margin Ratio goes to an amount equal to or less than 100%. 

17.3 Whether we fully or partially liquidate Your Trading Account under Clause 17.1 is at our sole discretion.

17.4 In all cases, you shall be provided with a notification that your Trading Account is being liquidated. 

17.5 In liquidating your Trading Account, we may do one or more of:

(a) close out and sell your entire Position;

(b) sell one or more of your Virtual Assets; or

(c) cancel any unexecuted orders on your Trading Account. 

17.6 The Mode of your Trading Account may have an impact on the type of Virtual Assets we liquidate from your Trading Account.

17.7 We may charge you a liquidation fee for any liquidation which we carry out.

18. Insurance Fund

18.1 There may be instances where despite the steps we carry out to liquidate your Trading Account, we are unable to recover the Maintenance Margin or any sums due and payable to us. This occurs where, despite the steps we carry out on liquidations, your Trading Account has a negative balance.

18.2 In such instances, we may, at our discretion, rely on the Insurance Fund to recover and top up the negative balances on your Trading Account. 

18.3 OKX cannot guarantee that your losses will be protected. For instance, during periods of significant market disruption our insurance fund may be depleted you may lose more than you invest and you may owe such negative balances to OKX. It is therefore your responsibility to monitor your positions and close out any loss-making positions promptly.

19. Auto-Deleveraging

19.1 In the event that the Insurance Fund depletes by 30% from its daily peak value within a period of 8 hours, OKX shall enable Auto-Deleveraging.

19.2 OKX shall use best efforts to inform a User when Auto-Deleveraging has been enabled.

19.3 For the duration of time that Auto-Deleveraging is enabled:

(a) OKX shall automatically rank all open Positions from most profitable to least profitable;

(b) OKX shall forcibly liquidate each Position at the prevailing mark price starting from the most profitable;

(c) the profits from each Positions that has been forcibly closed shall be deposited into the respective User’s Trading Account; and

(d) Users shall not incur any trading fees when their Positions are forcibly closed.

19.4 Auto-Deleveraging shall be disabled at the earlier of:

(a) when the Insurance Fund has increased by 75% from the value at which Auto-Deleveraging was enabled within a period of 8 hours; or

(b) when the Insurance Fund has a value of at least USD 8,000. 

19.5 The rules regarding the practice of Auto-Deleveraging are set out in: https://www.okx.com/help/iv-introduction-to-auto-deleveraging-adl.

Section 6 - Risk Disclosure

20. Incorporation by Reference

20.1 The risks set out in the Terms of Service are incorporated by reference in this Agreement.

Margin Risk

20.2 In addition to the risks set out in the Terms of Service, the Services have their own set of unique risks.

20.3 Before you are allowed to open a Position with us, you will generally be required to deposit Virtual Assets with us – this is called the Margin requirement. This Margin requirement will usually be a proportion of the overall Position value. This means that you will be using Leverage and this can work for or against you. A small price movement in your favor can result in a high return on the Margin requirement placed for the Position, but a small movement against you may result in substantial losses. 

20.4 At all times that you have open Positions, you must ensure that your account balance, taking account of running profits and losses, is equal to at least the total Margin requirement that we require you to have deposited with us. Therefore, if our price moves against you, you may need to provide us with significant additional funds immediately to meet your Margin requirement and maintain your open Positions. If you do not do this, we will be entitled, in our absolute discretion, to close one or more or all of your Positions in any Virtual Asset you hold. This means that we will sell all your open Positions. You will be responsible for any losses incurred as a result.

20.5 The need to monitor your Positions is of greater importance when you have entered into Contracts with us because of the effect of gearing. Gearing magnifies the rate at which profits or losses can be incurred and, as a result, it is important that you monitor your Positions closely.

20.6 It is your responsibility to review your account balance and margin levels required. If you are at risk of being liquidated, we will inform you through one or more of the OKX mobile application, the OKX desktop website or email.

20.7 We will be entitled, at any time, and at short notice, to increase or decrease the Margin required from you on your open Position. You agree that, regardless of the normal way in which you and we communicate, we will be entitled to notify you of a change to Margin levels or the credit arrangements for your account by any of the following means: email, or via the Platform or by posting notice of the change on our Website. Any increase in Margin levels will be due and payable immediately on our demand. We will only increase Margin requirements or change the credit arrangements for your account where we, in our absolute discretion, reasonably consider it to be necessary, including but not limited to, in response to or in anticipation of:

(a) a change in the volatility and/or liquidity in the Virtual Asset market;

(b) economic news;

(c) a Virtual Asset is suspended from or rumored to being suspended from trading on another Virtual Asset trading platform;

(d) you change your dealing pattern with us; or

(e) any change to the Applicable Laws.

20.8 Subject to Applicable Laws, for certain categories of clients we may not be able to accept the payment of Margin to be made by credit card or by any other credit arrangement made with third parties.

Section 7 - Miscellaneous

21. Statement of Account

21.1 We shall provide you with a statement of account on at a least monthly basis through the Platform.

21.2 In all cases, the Platform shall provide you with a live view of your current open Positions and Margin.

22. Balance

22.1 You shall always be able to settle the value of the Virtual Assets traded through cash. 

22.2 If you choose to do so, we may charge you fees and any other applicable charges such as taxes. The fees and tax owed shall be calculated to you at the time that you choose to pay the cash balance.

23. Representations, warranties and undertakings

23.1 In addition to the representations, warranties and undertakings you have made to us in the Terms of Service, you additionally represent, warrant and undertake that:

(a) you shall maintain the required Maintenance Margin;

(b) we shall not be liable to you for any losses you incur as a result of us liquidating your open Positions; and

(c) you are and shall remain compliant with all Applicable Law as these may apply to you, including any VARA Rules that apply to Services.

24. Payments

24.1 Any payments to be made by you under this Agreement, including fees, are immediately due and payable to us when you carry out any trade, or open or close a Position on the platform.

24.2 Any fees that are due and payable to us from you shall be automatically deducted from your Margin Account.

25. Amendment

25.1 This Agreement may be amended in the same manner provided for under the Terms of Service.

25.2 An amendment to this Agreement does not automatically amend any other agreement that you may have with us, including the Terms of Service.

26. Termination

26.1 This Agreement may be terminated in the same manner provided for under the Terms of Service and shall have the same effect as provided for under the Terms of Service.

26.2 In all cases, you shall only be permitted to terminate and close your Trading Account only after you have paid all dues and settled all liabilities that you may have incurred in connection with your use of the Services.

26.3 The termination of this Agreement does not impact any other agreement you have with us, including the Terms of Service. You therefore understand that if this agreement is terminated, it shall not automatically terminate any other Agreement you have with us.

26.4 We reserve the right to terminate this Agreement in our absolute and sole discretion for any reason whatsoever.

Schedule 1 – Definitions

In this Agreement, the following words, expressions and abbreviations shall have the following meanings unless context requires otherwise: