SOL Now Available as Collateral on Solana's Perpetual Futures Exchange
Traders on Solana's perpetuals exchange can now use SOL as collateral for margining positions, according to a recent announcement from Ellipsis Labs.
The development team behind Phoenix, the perpetual futures exchange on Solana, has enabled SOL as a margin option alongside USDC. This means that traders no longer need to sell their SOL for stablecoins in order to trade perpetuals on Phoenix.
Until now, a SOL holder who wanted to trade perpetuals on Phoenix was required to sell their SOL for stablecoins, which eliminated the benefits of holding spot SOL. With SOL collateral, the SOL can stay in the account and directly back the position.
Eugene Chen, CEO of Ellipsis Labs, stated that traders should not have to make a tradeoff between holding spot and trading perpetuals. He noted that SOL collateral 'solves this tradeoff' by allowing traders to stay long SOL while still taking positions in any Phoenix market without touching USDC.
The margin and collateral system on Phoenix works as follows: positions are margined against available collateral, with USDC counting at 100% of its value. SOL is currently set to 80%, which means that the available margin moves with the price of SOL. Cross-margining and settlement remain unchanged, with profit and loss continuing to settle in USDC.