Kraken Pro Expands Derivatives Trading Flexibility with New Collateral Currencies and Updated Haircuts

Kraken Pro, a leading cryptocurrency exchange, has announced significant updates to its derivatives multi-collateral trading suite. The updates include the addition of new collateral currencies, updated haircuts, and changes to existing assets, providing traders with more flexibility to manage positions and hedge risk in dynamic markets.

Effective immediately, AAVE, CAD, DAI, NEAR, MANA, RENDER, RUNE, STX, SUI, TAO, XLM, and XTZ are now available as collateral that can be moved to your Derivatives wallet. Additionally, BTC and ETH haircuts have been decreased, while others have been aligned with Spot Margin levels, providing a consistent trading experience and making it easier to manage collateral across both products.

In a recap of how multi-collateral derivatives trading works, Kraken Pro explains that it supports trading with a variety of assets deposited into a "Derivatives Wallet" as collateral, rather than just USD or stablecoins. A specific "haircut" is applied to certain crypto collateral assets based on their volatility profile, reducing the effective value of the asset. This doesn't affect the actual value of your assets or incur any fees, but helps maintain a safety margin in the trading system.

The exchange has significantly expanded collateral choices with the addition of 12 fiat and crypto assets, including CAD, AAVE, NEAR, RENDER, RUNE, STX, SUI, TAO, and XTZ, alongside their respective haircuts. Additionally, haircuts for a number of existing assets have been updated. Lower haircuts generally mean you can use more of that asset's value as collateral, while higher haircuts indicate more conservative valuations.

Notable haircut reductions include AUD, BTC, CHF, ETH, EUR, GBP, USDC, and USDT, while assets such as ADA, ATOM, AVAX, DOGE, FIL, GRT, INJ, KSM, LINK, MINA, and TRX have had collateral haircut extensions. It's important to note that collateral assets transferred to your Derivatives wallet and used to open futures positions cannot be exchanged for other currencies or withdrawn while positions are open.

Kraken Pro reminds traders that trading futures, derivatives, and other instruments using leverage involves an element of risk and may not be suitable for