You short $300 USD and post 10,000 collateral
In order to post the 10,000 collateral I need to buy them first so day 1 I pay -$300 to an external exchange
plus receive 10,000 collateral from the person who bought your $300 USD for a total of 20,000 collateral.
I don't get that. Where do I receive the additional 10,000 BTSX? When the green button appears that says "cover" I receive 10,000 BTSX on my account automatically?
You take 5,000 BTSX and buy $300 USD
I take them from where? From the 10,000 that I received on my account as per above? or I have to buy them from the exchange?
You take $300 USD and cover your short and get 20,000 BTSX.
Why 20,000? I have used the 5,000 already as per above so I have 15,000 remaining.
Initial Condition: 15,000 BTSX worth $450
The initial condition is 10,000 @ 0.03 = -$300 which I can sell for 0.06 so pnl +$300
Final Condition: 20,000 BTSX worth $1200
The final condition is buy 10,000 @ 0.03 + sell 15,000 @ 0.06 = $900 so pnl is +$600
So by shorting I do earn an extra $300. Do I understand now correctly?
Do I understand correctly that when the green "cover" appears I receive on my account the 10,000 BTSX which I can do whatever I want and at some point I have to cover my debt so the remaining collateral is released as well?
And final question. What is the short wall on BTSX platform mean? Why only these short orders appear? how does this work? If it is 33 for example and I place a short order at 32.5 what happens?
Thank you very much for taking the time to explain BM. Much appreciated!!