Crypto CFDs: bitcoin without a wallet
What you learn in 3 minutesA reader once asked why a bitcoin trade placed on a Saturday evening showed a loss on Monday morning even though the price had barely moved. The answer was not the coin. It was the cost of holding the position over the weekend. This lesson shows what a crypto CFD actually is, how margin, spread and funding charges work, and why the weekend can quietly change the number on the screen. All money figures are in rupees, and the arithmetic uses a USD/INR rate of around 83.2500 so the sums can be checked.
One weekend on 0.01 lots of BTCUSD
| Step | Amount | Note |
|---|---|---|
| Position size | 0.01 lots | A crypto CFD size, not a number of coins. The broker quotes the contract size, and it varies between brokers. |
| Notional value at entry | ₹41,625 | 0.01 lots at a BTCUSD price of 50,000, converted at USD/INR 83.2500: 0.01 x 50,000 x 83.2500. |
| Margin required at 20 per cent | ₹8,325 | 20 per cent of ₹41,625. Leverage and margin rules vary between brokers and can change. |
| Spread cost on entry | ₹83.25 | A 2-point spread on a 0.01 lot: 2 x 0.01 x 83.2500. Crypto spreads widen outside main hours. |
| Funding charge for two nights | ₹24.98 | A funding rate of 0.03 per cent per night on ₹41,625, charged twice: 41,625 x 0.0003 x 2. Rates vary between brokers and can be positive or negative. |
| Total holding cost | ₹108.23 | Spread plus funding: 83.25 + 24.98. This is paid before any price movement is counted. |
The broker may round the funding charge, apply a wider spread at weekends, or add a separate commission. Always check the contract specification, because these figures differ between brokers.
The mistake people make here
The common mistake is to treat a crypto CFD like a coin in a wallet. People buy a small position on a Friday, assume the weekend is free, and are surprised when the balance is lower on Monday. There is no wallet and no transfer, but there is a funding charge for every night the position stays open, and spreads are often wider when the main markets are quiet. Instead, work out the holding cost first, in rupees, and decide whether the expected move is large enough to cover it. If it is not, the trade is a cost, not an opportunity.Check yourself
A 0.02 lot BTCUSD position is held for three nights. The funding rate is 0.03 per cent per night and the notional value is ₹83,250. What is the funding charge?
83,250 x 0.0003 x 3 = ₹74.93, before any spread or commission.
The spread on a 0.01 lot BTCUSD position is 3 points. At USD/INR 83.2500, what does the spread cost in rupees?
3 x 0.01 x 83.2500 = ₹2.50, rounded to two decimal places.
If the margin rate is 20 per cent and the notional value is ₹41,625, how much margin is needed?
41,625 x 0.20 = ₹8,325.