Bitcoin Forum

I have been trying to study the good effect of leverage trading but I have noticed it is a way traders can lose money in just a matter of minutes or hours or days. I do not know why the government have gone very strict about kyc but most governments do not consider mandating exchanges to reduce their leverage. On exchanges with high trading volume which also has many people with enough coins that is used for borrowing which traders use to leverage, the leverage can be up to 100x, I was shocked the first time I saw 125x leverage for bitcoin USDT future trading.

The higher traders leverage, the higher the risk of coin liquidation. When I used 10x leverage for small trading amount when bitcoin was at $46000, it was still above $40000 that my money will be liquidated if the price decrease. I tried $0.2 to trade 125x when bitcoin price was $46558, the liquidation price price was $46480 which bitcoin can drop to in just a minute and increase back but money will be liquidated, If I use bigger amount like $200 for it with the same leverage, the same time my money will be liquidated.

20x leverage is still better but the liquidation price will also near the present price when the trader open position, any of these coins should not have more than 20x leverage which is still highly risky, I tried 10x, it was still highly risky. 5x is still better but very risky, the best is to just go for 1x or 2x maximum.

Why are the governments are not taking this serious, the average people that have no enough money will leverage, the rich will not leverage or reduce the leverage to make the liquidation price far, the average will lose to rich traders. It will be good if exchanges are forced to reduce the leverage traders can use, 100x, 125x is too much, 99% of traders that are using it will lose.

Or you can say also the other way around. Why thinking so negatively that the only result will be liquidations. There are also who are gaining in a matter of minutes and hours.

Only because they knew what they are dealing with.

You cant force them if they wanted to use a higher leverage with their small capital. They also are betting to gain some in the process. Yes you are right, some should only use an appropriate leverage depends on theit budget. Cause the percentage of being liquidated is kinda high. Well thats their money. Before they start this kind of trading they must have enough knowledge so they wont loss in an instant. Government cant do anything about this. The exchange only offering services hence the blame is still to those people who keep using it.

Leverage is “OK” if you don’t want to risk to put 100% of your capital in an exchange. If you have a capital of $10,000 ONLY for trading, then it’s acceptable to deposit $2,000 and use leverage as if you have your whole $10,000 in the exchange. I’m assuming that you’re a very profitable trader.

Yeah I think 125x leverage is definitely far too much for not gambling but what is people are going to exchanges to gamble? Most of the options market sounds like it could've been devised out of a few people gambling on stocks and seeing where they could get.

100x leverage has definitely become. Smaller. I remember the price being $2900 and having a liquidation price at 100x of $2886, that was way worse!

I'd also say 10-20x leverage might be comfortable for very immediate price movements too that someone's expecting and I've used both of those fine in the past with a high enough win rate - but if you're just wanting a high win rate and getting stressed about it you're not going to get one.

A leverage of 10 times means that you are a speculator. And this is a very dangerous new number, and if you choose ALLIN, then I can only say one thing: people without faith, go all the way well.

To control, newbies should not use one account for Spot and Leverage tradings.

One account for Spot trading. Another account for Leverage trading. If your Leverage position in the account for Leverage trading is called for Liquidation, let it be. If newbies do it in same account, the bad response will be made. Send more crypto to Leverage collateral but in worst day, the position will still be liquidated.

Asking why 100x leverage trading exists is the same as asking why gambling and casinos exist. ;D
It exists because there are greedy people,who want to win lots of money with almost no efforts.
The risk/reward ratio is very high and the people who are using leverage can "bet" small amounts and get big profits,if the price goes in the right direction.
Leverage is just a cool feature and the crypto exchange platforms are offering this feature in order to gain more customers.This is competition,market economy and capitalism.
The traders are using leverage at their own risk.The government can step in and regulate the amount of leverage,but the risk lovers will just run away and choose another crypto exchange platform,located in another country that has more liberal rules about leverage trading.

Yeah, you were right, 10x leveraging above is actually too risky if you implement that in the actual trading.
And also I agreed that most of the time your assets will just turn into losses in the end. This is real talk and true happen to
the majority of the individual traders who do leveraging. Therefore, I am not using this tools just to earn crypto instead,
I always go for the spot trading where I mostly got earned most of the time.

Personally my leverage does not go beyond 3x I can't cope with a high leverage of 5x and above this too risky and it end game is account liquidation, considering the high volatility of price of cryptocurrencies,. Binance has cross margin which is cool for me and less risky, I think the higher rate of traders who lost their portfolio or got liquidated comes from traders who traded with high leverages especially Future traders, infact a lot of newbies without any prior trading skills and knowledge opted for high leverage trading in a bid to become rich overnight but ended up rekt their account.