Question 1

Does OXHEDGE ever hold my funds?

Accepted Answer

No. Collateral stays in your wallet until you confirm a trade. Once a position is open, margin is held by the protocol's smart contracts under rules anyone can read, not by a company.

Question 2

What is a perpetual, and why use one to hedge?

Accepted Answer

A perpetual is a contract that tracks an exchange rate with no expiry date. You pay or receive a small funding rate while it's open. For a business, this means one hedge that lasts as long as the exposure, with no forwards to roll every month.

Question 3

What happens if the currency jumps overnight?

Accepted Answer

Positions are margined continuously. If your margin falls below the maintenance level the position can be liquidated. The estimated liquidation price is shown before you open, and lower leverage gives more room.

Question 4

How do liquidity providers earn, and what can they lose?

Accepted Answer

LPs take the other side of hedging and trading demand and earn from fees and funding. They also carry the risk of that net position.

Questions people ask first.