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In life, leverage is good as it helps to help us accomplish a goal faster. But in trading, leverage in trading is clearly a bad deal. It messes things up for both the traders and the market. So my question is why do exchanges still offer them. They keep pushing it to traders like favourite snack?

If you have $100 and the exchange has trading fee of 0.05%. In each position you open with 1x leverage with the $100, that is $0.05 as the trading fee of the position you opened.

If you have $100 and use 10x leverage. The trading fee will go 10 times higher. The trading fee is $0.5.

If you go 100x. The trading fee is $5.

Exchanges make money as the leverage increases. The exchanges do not care if you lose or not, what the exchanges care about is the profit they want to make.

If you are not experienced in trading, then dont mess with the leverage. Yes, leverage is increasing the potential profit you can have in your trade, but also the risk. If you mess up with leverage, even a slight down trade in your trade might cause your account to be liquidated. Even experienced and expert traders don't use much leverage because they know how dangerous it is and they know that leverage is not the solution for everything or easy money. Remember, in trading, if you take a shortcut and rush things, then expect that you might stumble once, and it will keep on repeating until you learn your lesson. I've tried using leverage, and of course it didn't go well. That's why, from that experience, I never use it again. That feature will never be gone because trading platforms know how greedy a trader is sometimes, and it will benefit them and also the narket.

Because exchanges are business platforms and what they are interested in is profit. Leverages are like lended funds to trade yes it is a bit risky but it’s also brings about more profit on a single trade than the one without leverages same as the lose but traders prefer to take the risk of using leverages just to maximize their profits. Any exchange that stops leverage trading now will lose almost all its traders as a customers because it is why many traders are after, in fact most exchanges lure in more traders with their high leverages. So as long trading exits I don’t see leverage been removed

Exchanges earn money by the fees they charge you and the number of people they can bring to their platform, if a person had 1k dollars and they thought this was an amount too low to trade the markets and make a lot of money with it, a thing they will be right about, exchanges do what they can to convince that person to become a trader anyway and use a very high level of leverage, so the person gets convinced about it and becomes a trader, earning additional profits to exchanges they may not have gotten otherwise, so it is clear why exchanges push leverage to their clients, even those that have a reasonable amount of money on their accounts.

The other trader who made massive profits on the otherside would disagree. It's not a bad deal to them. What is a bad deal is your poor trading decision. The money makes it's way to the smart traders from those who made poor decisions. That's how markets work.

The exchanges mostly benefit from the trading fees from all traders using their platform.

The answer is simple: the exchange offers leverage, as there is a demand for this type of trading. And despite the high risks of using leverage, this type of trading is very popular among traders and if you adhere to the rules of risk management, it becomes less risky.

Because demand is high. That's simply just it.

As for leverage being bad, it is bad if you don't know what you're doing — which 95%+ of people really don't, just like trading in general. Could be a great tool if you truly know how to trade(hedging purposes and such).

Leverages are roots of bad and worst things. When society, economy and market are good, you will feel leverages are like magic tools for you to get rich quick. It's time when you become more easily to forget about risk and lessen your principles on risk and capital management and how to use leverage to avoid risk and liquidation. It's time when things become worse and you even don't aware of such slowly changes.

When all things from society, economy to market become bad enough, you will see leverage is like toxic pill for you.

They get benefit from it. Losers is their customers, traders, not exchanges so exchanges have no reason to stop providing leverages, futures trading to customers.

Anyone can try leverage but how long you're going to do it? It's advisable that don't do it seriously when you are not even experienced and can't take that much risk.

Stay on the spot and be good with it.

They're not pushing it as it's not mandatory. It's part of their services offered to every trader as each trader doesn't have the same risk ratio and appetite.

Exactly and I tend to agree.

These should be the main reasons.

• Profitability, it's all about money.
• Increase trading volume, when the demand is high.
• Attract more traders which means for them more profit.

Traders trying to have a minimal risk on leverage trading by using stop-loss might still be hoping that they can manage the risk in this kind of trading.  As they said, a high risk means possible high profit.

I disagree with you that leverage is bad, it is good, but use the leverage wisely. One of the advantages of leverage is that you do not need to have a big amount of money before you have the power to take certain risks. It would have been so discouraging to some people if they did not have access to leverage.

The leverage calculation is even very convenient in crypto trading where exchanges make it flexible for us. If it were to be the traditional brokerage arrangement, it would be worse. Imagine, you need to have at least $10,000 before you can place a single trade with x1 in Forex by using a lot size of 0.1 if you use the leverage of 1:1. This was, unfortunately, the least lot size one could trade when I started Forex trading then. Now tell me, how many people can have that kind of money to trade with?

Leverage helps us reduce margin and open more risk, it is we who should be mindful of the risk we take and focus/prioritise on our money and risk management. The issue with people using leverage is not leverage itself but overleveraging by using all the risk associated with the particular leverage they choose. This isn't good. Now, how is that the fault of the leverage itself or the dealing house offering it? No one forces us, my friend.

Most traders have a background in Forex and regular trading markets, in which Leverage is used due to slow price movements. Therefore, traders often start with 1x leverage, and soon it turns into an addiction to reach a quick profit, so we see 10x leverage or more, which often leads in the end to losing your money.

But did you know that people that is making money from trading are the patient people. They have high amount of money and they are going 1x leverage or less than 1x leverage. I think what he meant is that leverage is bad because it draws the liquidation price closer to the market price but as the leverage increase, the exchanges are making more money.

leverage still being offered by many exchange or trading platform because people like it, they can make quick buck out of it from the slightest price movement ever, aside from the fact that exchange also make money from it.
but so far I've seen so many trader using leverage feature with lower capital to use, I guess it works like safe keeping their money form being used entirely just for one trading activities I find it rather quite effective, just leveraging 25x 3% of your money if worst come to worst you only lose 3% of your entire money but spot trading with entire capital if market take a hits your entire capital take a hits too even though its not lost 100%.
at the end of the day, both have their own advantages, avid trader that trades daily usually uses leverage far more frequently than the other people I presume.
so yes it might be dangerous but it has its place among those people that likes volatility and like to speculate, just remember though high leverage only gonna work for people that knows how the market acts.

Well, you could use leverage as your advantage if you are actually a good and reliable trader. That’s where you can maximize your profits and earn consistently. However, leverage is never good for those who are still starting to learn the process in trading. They should only trade with a minimal amount, something that they can afford to lose. Traders should know when to use leverage in trading, and when not to, in order to control the risks in trading and lessen their losses in trading.

I am not trading in other markets but there's a likely that it's also an inspiration from those just as what HB has explained. They're not pushing traders to stick with the leverage, it's all about our freewill when we trade.

Those that have background on it will definitely find for it. But this isn't for everyone, I've read countless failure stories about how they've increased their leverage and just a few hours away when they're not able to monitor it, they've been liquidated.

That's the risk and everyone except the newbies aren't aware of how volatile this market is. But the rest, you can count on them that they know what they're doing.

Exchanges are running a business, so it’s normal for them to offer leverage trading so they can also gain profits out from those leverage trading transaction costs. And while these traders are mostly greedy, most particularly those beginner traders, they eventually grab those ideas so they can start maximizing their profits at a short term duration. Not realizing that using leverage in trading gets even more risky, most especially if you are still not inclined in that form of trading.

It is one of the great things about leverage, they are the steroids of investments, then, losing in leverage is normal, but profits come, as long as you have correct management of your finances, and talent.

Consequently, the business for the exchanges is to have the product, since they are highly desired, and they are "approved" by the "FDA" /that is, by steroid mentions, then it would be the equivalence.    :)

If you don't have that, just buy and sell.  :)

Exactly. While the demand is high, exchanges will definitely take advantage on it, simply because they will also benefit from its profits. And as long as it will put profits on them, regardless if the traders end up losing, they will continue to encourage traders to use leverage in trading.

I guess I don’t see leverage as a bad thing, because it actually enhances the potential to make higher profits. But for a newbie’s point of view, it’s certainly not advisable for him because of lack of skills and experience in the market.

I dis agree with you, you can't totally put out leverage just like that, leverage isn't bad in it's totallity and cannot be seen as such but over leveraging is what actually turns to be a bad way of trading, do you know without leverage you cannot be able to trade as a retail trader, it's because of the leverage offered you by the broker you are able to trade your small $50 account and move it to $100 and above , if there were no leverage you will need much more than that to be able to trade the market which i know as a retail trader you may not be able to have that much and willing to risk it all on a single trade, because if you loose such trade then all your funds will be gone but when you bare leveraging you will be able to maintain some balance even after loosing a trade or two.

Understanding the concept of leveraging would have helped you better put your post but then you probably didn't understand the difference between leveraging and over leveraging and that's why you taught leveraging is totally bad of which that's not completely true as some persons have benefited so we'll leveraging which has helped them achieve greater heights trading than they would have if they were to wait till they are able to gather the appropriate amount needed to get a position on a trade.

I think the reality is that Leverage is done by people who do not understand the risk that is involved a lot, and that is why a lot of people are fully against it. There aren't that many things in the investment world where you can lose 100% of your investment, sure there could be some drops, like for example if you had bitcoin in the past month, you had a drop right? But not 100%, whereas in leverage trading you could lose 100% of your investment and that is what people are fearing right now as well.

That is why I understand that it may not feel like something you could do without much trouble. I personally believe that the best thing we could do with this would be avoiding Leverage, because that is the simplest solution.

One thing I know about using leverage in trading from the ones I have seen is that, it acts as an amplifier for any loss or profit made while using it as a method to trade with.

It isn't an advised method for newbie traders to use, because it could mess up their minds emotionally when they make losses and that's a multiple of the amount they initially locked in to trade.

For those who have some experience trading already, am sure you are aware that there's a recommended leverage for the amount in ones account to be traded with, and for an  Account with about $10 - $50 in it, the recommended Leverage to use would be about 1:100 or lower.
Also, an account having about $100 - $200 will have to follow a recommended Leverage in the ratio 1:200 or lower still.

The risk is as high as the reward while using leverage in trading and it's not advised to use borrowed funds or money intended for good use to trade leverage, because any loss might be hard to recover from.

I have been avoiding trading in futures and have never done leverage anymore. I don't feel that I can do it and it's just best for me to stay in the spot and I am more free to move with it. Compared in doing futures, you need to be active at most times. You'll be surprised by the market's motion and you're not prepared when it suddenly falls down or it suddenly gotten up and it's the opposite on how you leverage your trade and no doubt you'd be liquidated with that.

Trading with leverage is never an ideal one for those traders who want to avoid trading at high risks. It’s still best to trade at your own risk, without putting so much stress and pressures in your own trades. However, while this one gets avoided by regular traders, still there are those who manage to trade using leverage in trading. That’s because there is always an advantage for those who are obviously good traders, as they can certainly increase their potentials to make huge, satisfying profits.

Yes, it's not. But there are risk takers that wanted to do it because they think that it's going to be helpful to them and will make them rich quickly. They don't know how many times those successful traders on it have done and took a lot of losses before they're able to make it.
It sounds easy and chill but to be honest, it's not really ideal for everyone and only a few should do it. But hey, everyone has got money to trade so no one is going to stop them until they realize that it is not for them.

Do you think everyone makesl lose I think only those who aren't knowledgeable enough to know what they are doing keeps calling into prey for this, Thus if you don't make profit doesn't mean others aren't making profit and between, your lose is profits for the market or to another trader while your profits is another traders lose there the market is known to be called " survival for the fittest" if you aren't strong and smart enough you would keep losing.

It only gets bad if you are struggling in trading, but if you have high experience and gained sufficient knowledge in trading, you will definitely look at leverage as a bigger opportunity to chase higher potential profits. That’s why we have seen lots of traders still want to learn and suicide in using leverage, because they all know it can make your trading instantly massive.

On part of the exchanges, the fact that they are getting substantial profits from it, surely they will continue to attract traders to try trading with leverage. At the end of the day, your decision will still be greatly influenced with your trading preference.

Trading itself is already risky, even without any leverage, it's already risky.
Trading with leverage is like the next level of trading where the risk is higher but the rewards are high also.

So for me, we must not blame exchanges here because at the end of the day, it will be up to us if we trade with leverage or not.

Without leverages, people can lose nearly all money if they bought Terra LUNA token in 2022 Terra and UST crash. The death spiral of Terra and its algorithmic stable coin can kill any trader even no leverage is used.

That is a big lesson and can be used as a reminder that "Only trade with money you can afford to lose it at any cost" because in trading, black swan event can occur anytime.

Risk is bigger with altcoins and very fortunately, if you pick Bitcoin, you can reduce risk from trading. With Bitcoin, no algorithm that can trigger a death spiral like LUNA and its algorithmic stable coin UST.

The simplest answer to this is that I think leverage is the best way to earn good profits. I'm talking about the profits that exchanges earn by charging fees on your trades. When you open a trade an amount of fees according to leverage set is charged by the exchanges and that's why they're offering them.

Leverage is best for the platforms offering them but it's worst for both the trader and the coin that is being traded on. But due to the factor of greed people take a punt and these kinds of people don't want to listen to anyone until and unless they lose a heavy amount of money.

right? leverage exist for a reason, people with small capital wanted to have that opportunity to turn their peanuts capital into some good profit, because imagine trading $10 it will take years before you can even make profit that without even taking into account the fee, with leverage such as 25x the capital easily becomes big, the problem that most of people have with leverage trading is that they think they should just go big with their capital and leverage it, thats in its own isn't really true, people can just use small capital with high leverage just to test out the market.

the leverage feature also not enforced to the people anyway it just to give the opportunity for people that are so sure with their trading strategy.
even in stocks and forex there are leverage so its not really a feature that is alien to most of us here, i think leverage can work so good if combined with great strategy.
but i can also be double edged swords too so it depends like many have stated don't blame exchange for providing features.

There are many newbies who don't have enough knowledge about trading and it's not right to bother with levers. Those who are new to trading must first gain enough knowledge about trading if you don't know enough about trading then you will never get success through trading so first you need to know enough about trading and gain knowledge then start trading. Of course you have to have a long term plan before trading. If you can keep a long term plan and check the market in trading then you can definitely get success through trading.

Naturally those who are new must have less knowledge in the trading sector. But among those who are new to trading, those who have money and don't mind losing it can move forward first. On the other hand those who are new to trading even though they have little capital but that is their only capital then they lose money in the initial stage and lose confidence from trading. Personally I think only a long term plan, patience, time, skill acquisition are part of learning to trade but of course you need to practice and gain experience with money. So if all the above are perfected you will go to a stage and get success in trading.

If only the exchange made a profit from using leverage, then there would be no traders who would use it. So it is beneficial not only for the exchange, but also for the trader, who can get additional profit thanks to leverage.

Leverage is never a bad feature because it helps trader with low capital to borrow more capital for their trade in exchange for the risk of liquidation which scalable depending on the amount of leverage which traders will use.

You will never encounter a serious problem on leverage if you use it properly and avoid using high leverage on a very volatile assets. There’s also a stop loss feature that will save you from severe losses on case the markets doesn’t move according to your trading plan.

Overall, leverage is a handy trading tool if you knew how to use it properly.

it does indeed 100% helpful when we are short of capital but want to make big trade anyway, instead of just stuck with low capital and make all the profit got eaten away by the fee due to the fact that if we have low capital we might need to try find opportunities between price movements, with leverage we can get good profit so long we are so sure that the market gonna be turning like what we've predicted then we might get good amount of profit with just low capital alone.
it is helpful for those that can take advantage of the feature but might be a disaster for people that are greedy only thinking about profit they gonna get not thinking about the loss they might endure due to irresponsible use of the leverage feature.
overall its indeed helpfuil.

Hmm, well bro the fact is people just don't pick up the things, because as you know in talking about something and executing something there comes a huge difference, and 70% + people fail in execution about what they commit.

TBH, Newbies these days follow YouTube influencers and their primary motive is always to sell the premium signal group courses, newbies fall into the profit screenshots of those influencers, people believe in them because many people are following them but they are now aware of the reality that most of those people are thinking in the same way as they are. Who will not get attracted to their marketing strategy that one user joined today and made 1000 bucks and they don't know how much he invested if a person who invested and took a $100k trade with his 5k investment on 20x and made 1k out of what's the big deal in the this in the bull run 10% to 30% profit is not a big deal in the bullish crypto market. 

You know that it depends on the situation. You can take advantage of being able to have more capital in a trade when you are doing that. It would just depend on the risk management that you have and you should take it with full consciousness so you could take advantage of the situation. It's more likely to push yourself in a way to boost possible earnings but it can be a double-edged sword as well.

Can you pinpoint how exchanges "push" it towards traders? Mostly it's unlockable if you agreed to some warnings that it's dangerous if it's not done with caution.

This is definitely a less risky path, but unfortunately, or fortunately, who knows, many things can only be learned through experience. Even more: from one`s own experience. You can be an incredibly successful trader a thousand times on paper or on a test account, but until you start trading with your real deposit, you won’t know much about yourself. And this knowledge directly affects the trading result.

You see the way leverage can help you in life, the same way trading can help you maximize profits but then you have you to do it in a coded way that it wouldn't back fire. In real life, if you want to leverage I'm not sure if you would do more than your capacity. For instance borrow funds to gamble because you think you can win, take a huge loan to finance a new business that you aren't too experience in, all this can go sour. The same logic goes with trading when you trade with over leverage position because you want to make quick money.

Leverage trading is like gambling, there are people that are making from the gambling and we have more people losing, it's the same logical way leverage trading does but the exchanges are not the ones making the money. If you lose in leverage, there is another trader that has made money from your losses. What the exchange get is the trading fees and nothing more. As long as the demand keeps coming from traders, they will continue to offer the services seamlessly.

I would not compare leverage trading with gambling. In my opinion, gambling is more tied to luck and chance, while trading is a more rational, calculated activity. Leverage increases risks, no doubt, but the essence of trading remains the same. If a person trades carefully and prudently, then he will do this, with or without leverage.

The higher the leverage the more you're crossing into gambling territory.
2x - 5x is doable if you're really into this and want to make some money fast, or lose it fast. People who use 20x and more are just gambling because there's no way they can predict if in the next hour the price will be 1% higher or lower and when a very small move can liquidate you you're not relying on indicators, but rather on luck. Why would you risk everything if you can hold your 1x or 2x position for another month and make money anyway, because bitcoin is trending up in the bull market so it's going to attack higher prices eventually. Don't be hasty or you'll lose.

Gambling and leverage has some similarities to some extent. Whatever decision you make in gambling, the outcome is not on what you expect it to happen, the entire outcome depend on what happen in the field(for sport bets) and if you do the comparism with leverage trading, when you place your position either long or short, you don't have the final say on what will happen later, it's the market move that will decide. So playing this kind of risky games means you are hoping it happen in your favour which is pure gambling.

Spot trading is different from leverage trading, the risk control in spot trading is far less than leverage trading depending on your leverage size, the money you are dying hard to make, if you are patient enough you can make it spot trading. It's all about been patient and buying at the right time. If anyone has bought some chunk of Bitcoin at $20k with good amount, I see no reason why someone will be fighting to long/short market at every opportunity.

While leverage makes trading riskier, but we all know that if you’re skilled on it, you will also gain higher chances of making a larger income, something that gambling can’t guarantee. So I also won’t agree that using leverage into trading falls into gambling, except if you are trading from a gambler’s point of view. With that, you will definitely end up with huge losses, no doubt.

No matter how corny it may sound, but if risk management is not followed, then you will lose your money anyway. And it should be understood that if someone risks the entire deposit in the hope of getting a big profit, if the price moves in the opposite direction to his expectations, his position will be liquidated by the exchange.

In this case it is necessary to look at many elements, because looking at leverage is like a multiplier how it works, it is true that we can see and do research efforts with mathematical systematic analysis of the market, but in practice there is an element of gambling, secondly the most catalytic in my opinion here because trading that has leverage is trading using derivative products from the original asset just like forex products in forex, This I conclude that there is no buying and selling activity on the original goods or the original coin, it's like you put your money and choose your multiplier then you will predict where the market will move, more or less that's how it works and there are many elements of this included in gambling indirectly.

Risk management is often ignored by most traders as they do not think that is where money is made, for them studying the ways of opening a position at the bottom and closing it at the top is where the money really is, so they do not want to waste their time in a skill that seems geared towards protecting their capital instead of gaining it, a big mistake without a doubt, but one most traders do not realize they are making until the markets move against them and their capital gets decimated.

Loss and profit are parts of trading that cannot be separated - but when traders have risk management, they can minimize losses by prioritizing strategy over ambition. Greed is often the reason why traders have to accept unwanted losses - they can even fall into the same hole when they don't learn from previous mistakes. High leverage is a trap - don't play around, it will give the trader a high chance of losing all his money.

Risk management is the most important thing in investing and trading - but regarding future trading, risk management may be more difficult because many traders are too eager to get high leverage to get multiple profit. I don't know - I don't like trading futures, it has a high risk of losing all the money compared with spot trading and investing.

Leverage will fall into gambling if you don’t know actually how to trade using leverage, but if you are an expert in trading using leverage, then one should not worry about it. In fact, it will even increase your potential profits and achieve faster your goal in trading, but for some newbies who are still starting to trade, using leverage should always be discouraged as the risk to lose is high and it can instantly vanish all your funds in just a very short time.

there's always reason why big fund management out there always priorities risk management, whatever asset they tried to add to their portfolio these big fund management seems to really focused on how to keep the money from losing while also gaining profit which definitely gonna be ignored by most of the investor and trader out there.

when our money is just too low in term of capital just pursuing profit maybe does make sense, it only doesn't make sense when our capital has grown big enough that we actually need to start thinking about how to manage the risk, we already get the advantage of having big capital at that point so profit is not a problem anymore but how can we make our capital remains the same if not growing thats what should be of concern.

leverage is okay, if we only use 5%-ish from our overall capital, it might opens a way to further faster the profit generation but it always comes at risk, as far as I know, trading with leverage, add so much risk to our portfolio if not managed properly just as you stated too bad many people ignore this kind of thing.

Why do exchanges offer them? Because they get more in trading fees.

If someone has $100 and the exchange fee is 0.1% the exchange gets $0.10 for a trade. Since they need to exit the trade, eventually it’ll be another $0.10 bring the total to $0.20

But if they offer 100x leverage, instead of $0.20 in fees, they will get $20 in fees. They don’t care if the user makes money or not, as long as they get paid for their fees.

This your question somehow sounds ridiculous because you as a person should have known that the exchange you are using to trade don't give a f**k if you are losing or not, what is more of a concern to them, is how much they can make, so the leverage will always be there, and mind you, leverage is not a bad thing in trading, if it's been used properly.

Me as a person, when am trading, I don't use more than 3x leverage you know why? Because over leverage is the easiest way to get liquidated, but if you are knowledgeable enough in the craft, you will definitely not abuse the the privilege of having access to leverage, because in as much as it is been used to double up our margin, it can also be a trape, if you don't know how to use it properly.

Yes and no. Exchanges are not entirely innocent here ... You have to look at where leverage trading actually comes from. Leverage is used as standard in forex trading (EUR vs. USD, ...) because the price movements there are so small that without leverage you would have to bet incredibly large sums to be able to make any noticeable profits at all.

The fact that leverage is now also offered in a market that moves significantly on all time frames (low and high) is neither necessary nor, in my opinion, sensible at all. It simply looks to me like exchanges are using this to take money out of customers' pockets even faster.

On the other hand, customers are of course entirely to blame if they use leverage and lose money.

I think it is still quite normal for the exchange to still make its offer with something because leverage itself is a form of great control that is had in a trade so in trading this can always happen even though some people consider it to be a bad deal. Because anyone can see that if someone is able to control the market, it will definitely be easy to achieve profits even though it is not determined by when the time comes. And when the exchange offers it to many traders, it will also be more profitable for the exchange in terms of any fees received from traders with an amount that may be quite hefty.

In futures trading, leverage is needed to double profits for a trader. The lower the leverage, the lower the risk borne by a trader, while the higher the leverage, the higher the risk of losing money when prices fluctuate.

Futures trading is never suitable for those who rely solely on luck, but futures trading is for those who are truly able to analyze the market and are skilled enough in risk and emotional management. Futures trading is tempting because of the possible returns, but carries a high risk of losing money if it is not supported by a strategy and starts with greed.

however, futures trading is very popular with traders, especially new traders. for some reason, their interest is in futures trading rather than spot trading. I don't have that data, but from the few people who come to me, there are more of them who are interested in trading with Leverage. they consciously know the risks are higher but they think their chances are also high.
Perhaps because of the large amount of interest that exists, that is what prompted the exchange to be very serious about developing and offering futures trading. they make huge profits from futures trading.

Of course, you can't draw conclusions from just one or two people who come to you and show interest in futures trading. So far, 10/10 people who come to me are those who are interested in spot trading as well as investing, but just as I said, I can't make the right conclusion that spot trading is more interesting than futures trading.

The logical reason why futures trading attracts so many beginners is its profit potential. But unfortunately, beginners focus too much on profits while many of them ignore the high risk of loss. It might still be fine if they learn from a mentor, but things will be bad if they come with all their budget and make big mistakes because they are interested in other traders' profits.

You are wise this way and there is nothing reasonable to compare there still, as leverage (trading) and gambling are not just the same thing. In gambling, you may increase the risk of your bets, and the same is true in trading, you may increase the risk of your trading, that's the only sense they correlate here, it is all about your risk affinity only. But for the operation itself (trading and gambling), they are just different in every aspect because if you are trading, you are actually engaging in a business, it now depends on how good you are with the business since it is a very risky business.

But for gambling, you are not engaging in any business but a form of betting which will not be able to sustain you no matter how good you are, or how good you believe you are in doing it. From a point of view, I've seen enough traders on the street, they are tactical and consistent about it. And if you check social media today, you see lots of them that rely on it alone and are big boys openly who started with a small amount. Can you tell of gambling the same way? Certainly No. This is a little hint that they are not just the same thing. And if you know how to play with your leverage very well, you get more earnings in trading through it, but it becomes an issue if you are gambling on the high leverage when you are not a good trader.

Oh I see but 1x leverage still seems to be small and may not something to worry about about. If it's only about earning a quick profit, trading without using leverage is possible but they can use leverage in order to enhance those minimal profits that they can get.

I wouldn't say it's an addiction but this is only normal in trading because price volatility is always there but it can be called as greediness once a trader uses more leverage and capital to trade. It is risky even if we say they are skilful and losing is also normal even on a regular trade because once they lose it, it can badly affect them not only financially but also mentally, physically, etc...

Trading leverage might work if you have high experience on trading using leverage, but if you’re still new to it, you have to stick with risk management as it’s very crucial in trading, hence trading with leverage is highly discouraged for beginners. Don’t trade and focus on greed, you will never be successful and profitable in that case, but if you trade with an average amount of capital slowly but surely, then expect that you will have something to profits at the end of your trade.

I do agree that it is not clear with just small samples and we can't really make a big distinction out of this situation in the end. We need to make sure that we are hearing what people are saying of course and we help every person who comes to us with help, but that doesn't mean that we are going to end up with anything greater or bigger and our small sample size is not going to be the decision maker neither.

We just need to make sure that we are just seeing this as what it is, it is going to be just what our friends or so could make. That is why I believe that we are going to end up with anything major, it has to be the most important part and could definitely end up with just seeing what we could have done that eventually.

Good risk planning and management will likely produce good results. No trader is 100% successful without sacrificing time and money in the learning process, in fact they have to fall and fall before finally getting what they want.

Of course there is a lot of knowledge and advice that we need to consider from other users' experiences, it will definitely help us grow better. There is a long process before finally being successful, and each process will not always be easy. Market dynamics basically teach us to remain wise in making decisions, regardless of whether we are investors or traders.

Leverage trading didn't start with crypto trading, I don't understand why we see it as big deal been utilized by exchange. We have leverage and margin options on brokers that provide forex trading to many customers and they are satisfied. The only problem here in crypto is that a lot of exchanges knows that traders love high leverage because they are too greedy that's why you see leverage as high to 25x when on brokers you will see a max of 5 to 10x on regulated brokers.

We still have some leverage exchanges thag provide as high as 125x leverage for traders to use and when you check those exchanges, you will see activity of traders going on live, this is to tell you that many traders love gambling on leverages rather than doing normal trading, so don't blame the leverage platforms, blame the people who go their to trade.

Absolutely right, exchange market want to get more higher fees trading trough leverage and each time transaction with short or long position opening has bigger fees than spot trading or without leverage. Get maximum leverage give more bigger fees for exchange market and your explain 100% correct how many exchange added many new coins in future market listing.
Get small fees with manual trading or spot trading without use leverage, but when trader try with that feature market get much benefit with trading fees except still has funding fees when position up to 8 hours without get close. Much fee transaction earned by exchange market with their exchange have leverage or future trading feature, I don't think with this kinds of trading will close by market in the future except some local exchange market still not allow with this feature seems their government regulation.

At the risk of repeating myself:
Leverage is only needed - and should only be used - in forex trades. However, trading platforms for forex support significantly higher leverage than x5 or x10, sometimes even x500. The reason for this is simply that the daily fluctuation margins in forex trading are so small that you need such high leverage to avoid having to invest huge amounts of capital.

However, this factor does not apply to Bitcoin or crypto in general, where the daily fluctuations are already so enormous that trading without leverage is already worthwhile with small positions ... or not.

Leveraging in trading should be one of the most important aspects in trading and we need to earn so that we don't end up doing the wrong thing because we don't have the knowledge or skill to go about it. It is very important for us to try as much to get the skill in trading with ease not trying too hard to make things happen. Leveraging has been the problem if many traders because they don't want to calm down and learn how to trade successful or trade with being greedy. Greed has been the problem of many gamblers and we need to make sure everything gets resolved as soon as possible.

That is how they attract new traders. This is business and leveraging ideas makes them more money. If you are a trader with only have small capital, you could really think this is the solution. Well, this also helps them to start but the exchange of such offer is quite not good especially if you lose them all. That is why if you are a beginner, this is highly discouraged in order not to face the huge consequences. It is better to just borrow money from your friends or from the locals rather than use this leverage feature of the exchange. Or the best thing is not to do any of these ways in order not to compromise our finances.

I actually never thought that trading with leverage was good for us, except for professional traders who are already experts and are used to leverage. Trading with leverage is something that carries high risk. Yes, indeed, it can really make us get extraordinary profits. But on the contrary, it can also make us lose our money quickly. especially if we play with high leverage, and without sufficient knowledge. So, if you are not ready, then it is better not to leverage, or just use small leverage with good funds management.

You shouldn't be so categorical) After all, everyone knows that one of the advantages of futures trading is opening short positions, which is impossible to do in the spot market. And since we are dealing with a highly volatile market, then you can choose for yourself the minimum leverage of x1 to open a short position.

With Margin and Futures trading, people can open short position that they can not do with Spot trading. However, with Margin and Futures trading, they will have to face with more manipulation from market whales and exchanges.

Centralized exchanges have data on opened positions of their users and they can use available data to manipulate market price to kill long and short positions. At the end, centralized exchanges are winners. People will long or short positions will be liquidated but they can not complain and can not get money back as it is part of the game with Margin and Futures trading.

well thats kinda the essence of leverage honestly usually I think the exchange will always give warning of the side effect of using the leverage feature it is definitely described as a double edged sword where it grant opportunity to people at the cost of their capital.
most of the future trader using leverage out there I think are people that are experienced already, if they are just some random newbies that are leveraging their asset it might means they are greedy and will probably just lost the money along the way.
if you are experienced in a nutshell feel free to use the leverage feature, but if you think your newbie, you know whats best for you maybe the spot trading is already good enough a place to start.
i think its as simple as that.
its just the right feature provided by exchange to give people the chance to do much more than their capital actually allowed to do and I think there's no problem if an exchange having it as a feature.

I understand that margin trading is not acceptable for all participants, but I am sure that everyone who lost money using leverage, they all violated risk management. And the fact that you cannot adhere to the risk management strategy is not a reason to refuse to open short positions when the market is in a bearish stage.

I see on X  (CT) everyday that newbies are advised to stay aware from leverages due to how inherently risky it is to open and hold a leveraged position especially in times when market is volatile in the other direction of one's trade. Despite all the negative opinions and feedback by KOLs and influencers, I do think that leverages are net positive for the space when it is done with (aka with proper risk management  as @tvplus006 has already said).

If done right, leverage can give you the much needed liquidity to make good amount of profit enough to set you up for life because in trading, liquidity is king.

Before worrying about leverage, we must first understand trading well. If we can gain knowledge about trading, then if we trade, we will definitely get success through trading. There are many newbies who bother with Liberace without having a good knowledge about trading, I would say for them, of course, in the case of trading, first of all you need to have enough knowledge about trading. In the case of trading, we must have a long-term plan, we must check the market, and if we trade patiently, we will definitely become successful traders in the future.

Trading with leverage naturally always involves risks that you should always be aware of it can of course happen that the price does not move in the desired direction and just as profits are multiplied losses are also multiplied. For example we take $1,000 and bet on the rising price of bitcoin with a 5x leverage if the price goes up by 10% we make a profit of $500 which is a gain of 50%. However, if the price falls by 10% we make a loss of $500 and lose half of our initial amount. If we take this to an extreme and say we use a 100x leverage we would double our money if the price only goes up by 1% but if the price goes down by 1% we would lose all of our invested capital.

I think that in this case it is necessary to use a stop loss. In this case, you can reduce your losses if the price moves in the opposite direction to your expectations, for example 1-2%. Thus, your loss will not be 500 dollars, but 50-100, depending on the level at which you set the stop loss.

It's reasonable because leverage is a a double edge sword. You can buy double or 10x amount of coin with the amount you invested but you have a margin limit to carry on. Once you exceed that margin threshold, all your money at risk will be gone faster. That if you overleverage, your stop loss will be too tight and not enabling your trade to breath for some market correction. Leverage is only helpful when you use it the right way.

I know you gave an example only but in this volatile market, stop loss with 1 - 2 % will be terrible. I know stop loss, stop limit orders are very helpful to minimize loss and avoid serious loss in a market crash but 1 - 2 % should not be used as a limit to exit the market with either Stop loss or Stop limit order.

One of best weapons in trading (https://bitcointalk.org/index.php?topic=5173189.0)
Bitcoin supports and resistances for dummies (https://bitcointalk.org/index.php?topic=5263232.0)

the difference of leveraging with forex and crypto in forex it incentivizes faster market movement by using high leverage with the smallest change of a price we can get big profit at the risk of the captal itself.
meanwhile with crypto its just purely leveraging for the purpose of getting bigger profit I mean in forex the purpose is also kinda the same to get bigger profit but without it the forex market would be boring.

despite the controversy though I really like this feature, with small money you can turn it into bigger ones and if you lost well you lost anyone using leverage should know they are risking their capital more than anyone else the higher the leverage they choose, though in crypto trading, most of the trading platform only offers 25X leverage probably above that it will not make sense since the price movement and overall volatility of the entire crypto market is really volatile that a little shake your 100x leverage gonna gone in an instant.

still for newbies they need to watch out, leverage isn't for amateur, even pros are carefully leveraging their capital.

So there is no difference after all ;)
I would also like to have significantly more movement with small stakes in crypto. You don't necessarily have to use leverage in Forex either. For example, if you enter a trade with 1 billion dollars, it doesn't matter if the market only moves 0.001%, the movement is still enormous in terms of FIAT movements.

Don't get me wrong, I have absolutely nothing against an exchange offering leverage if clients want it. But as a crypto trader in particular, you have to be aware of what you are doing here and how quickly leverage can lead to your account being completely wiped out. Unfortunately, I'm not sure whether exchanges are doing enough due diligence and should, for example, block leverage for newly registered customers anyway.

Yes, indeed, I have given these figures as an example. Nevertheless, these figures are quite real if you open a long position from support and, accordingly, short from resistance. In this case, you will have a very small loss if the price moves in the opposite direction to your expectations.

When people talk about a stop loss being 1% to 2 %, they refer to the amount of money they can lose on each trade before they are just gambling their money away, and not necessarily the level at which the stop loss level should be, so as an example, supposing the price of bitcoin was at 70k, you wanted your stop loss to be at 60k and you had a capital of 100 dollars, how big your position size should be in order to only lose 1% of your capital if the stop loss was activated? And the answer is 6.9979 dollars.

When running up a business, then of course you would really be offering something that brings out advantage for you as a business owner.  ;D

Why do you don't think oppositely?

The importance of a trader is capital, trading capital. If a trader loses his trading capital, his trading career is over.

10% loss is 10% loss, no matter how big or small your trading capital is. $7 can be very small with many people but with some people and traders, it's big and worth to protect it.

1% or 2% loss is small, repeat it 20 times, and you will lose 20% or 40% of your initial trading capital, not small at all.

I've always said that it is not about the leverage but the risk taken through it, and even if you are planning to trade with some risks, you should be planning to trade with some management that will be able to counter the excessive negative effect of the risks. This is why I appreciate what you wrote here. As an experienced trader myself, I know the value of minimizing our risks, and if someone can down it low to the level of 1-2% then it is a very good bargain that will most likely not affect the trader. Because such will not lose his money so easily, and when the trading strategy of the trader is good, it will be another opportunity to overpower the market squarely to the advantage of the trader.

Also, the use of support and resistance to place the trade is so important in minimising the risk exposure. You can't compare the person who bought an asset at about 100 pips above its support level with the person who bought it barely 5 pips above it, the latter is the better trader who is being cautious with the risk management and the account safety. Nonetheless, one should also ensure that the support and resistance strategies they use are strong enough for this task, this is where many traders miss it and not the managerial plan itself. I use trendline, price action and the peak and bottom of candlesticks to actualise it.

For now I had the options to do dual investment within one day at Kucoin, no matter what the result is the profit remains stable.
You're right, leverage  isn't a good idea since there's a big risk involve. So to make things more productive let's rely at exchange sites progressive recommendations.
However, minimal portions of risk can be experienced but not as worst trading leveraging.

In my opinion, it is too presumptuous to call someone an expert in trading. Trading is not some objective and constant activity, which you can master step by step. Even if someone has great experience and has made a lot of success deals, doesn't mean he wouldn't make a mistake some day. Taking leverage is always a risk, no matter how confident you are about yourself. However, leverage trading is more "calculable", if I may say so, then gambling. Because in gambling there is little data you can stand on to make a bet, while in leverage trading you can use market instruments to make your order more probable to happen the way you think.

Mistakes are inevitable and this is something that you should really be that normal on this space and its true that no matter how experienced or veteran you are, you would really be still have the chance on finding yourself that getting liquidated or being that losing money with your trading positions but the possibilities of having those recovery could really be entirely be different or noticeable in comparing into those people
who are just that new into this field. Trading leverage is something that you should really be needing up to consider or to look out because its never been advisable that you would really be setting those bars high
on which we know that this is something that would really be that so risky on doing so or not really that recommended into those people who arent really that good in spot trades.
As much as possible i wont really be  touching up this area.

The use of leverage in trades always falls into the realm of gambling, as the risk is exorbitantly higher than with trades without leverage.

You won't find any professional traders who use (high) leverage, if only in livestream sessions to generate clicks, as the numbers simply move much faster and people stay on the streaming channel for longer. On the other hand, live trading has little to do with professional trading and should rather be seen as entertainment, as the factor of highly concentrated decision-making on how to react in a trade is eliminated.

The safety of using leverage is directly related to risk management, compliance with which depends only on you. And if you do not adhere to the risk management strategy, then your entire trading will be comparable to a casino in which you will eventually lose your deposit.

I'd love to learn leveraging for me to understand further and have full knowledge about it, lacking of exact information is my biggest fear to deal with from it. Indeed, losing deposit is really similar with gambling at casino which is really I don't want to happen with my earned money online.
Most of my crypto enthusiast friends enters trading out of the blue, eventually they'll lose their funds due to overconfidence. That's why I'm really careful taking risk without proper understanding.

indeed 1 - 2% is small amount, it will at the end of the day only causes the trader to lose their money, market volatility is a thing and the market volatility tolerance should be around 10%-20% instead of just 1% its like basically you just open your position and then it get closed almost immediately, the winner here will be the exchange that gonna get all the fee.
though is it necessary using stop loss if we can limit the money we put at stake? like basically we just use 10% for leverage trading, we at worst just gonna lose that 10% but it won't ever got the position closed because the preventive measure already done before hand.
I find that to be more ideal in my opinion,  since there has been many cases where market just gonna have flash dump about 20% then climbs up again, such event I think is created artificially by whales to liquidate whoever leveraging and have cut loss measure.
that means we just getting played by the whales.

Before you move on to margin trading, you must learn how to trade on the spot market so that this trade brings you profit. And there, in the spot market, you will have to learn how to adhere to the risk management strategy. And only after that you can try yourself in margin trading with a minimum leverage of x2.

The possibility of recovery after the loss of a deposit, especially a deposit with leverage, depends not only on experience in trading, but also on the psychological attitude. If a trader is experienced, but his “portfolio” contains only successful transactions, then he will perceive failure critically, this can undermine his self-confidence and unsettle him. If a person has adjusted himself that losses are the same part of the trade as winning, if he adequately treats the possibility of his own mistakes, then he will draw conclusions from such situations faster and better. And this will not demotivate him to engage in trading in the future.

Excess leverage in trading can amplify both potential profits and potential losses. But there's no need to fear leverage once you learn how to manage it. The only time leverage should not be used is if you take a hands-off approach to your business. Otherwise leverage cannot be used successfully and profitably through proper management.

The risk for your capital loss is from here, excessive leverages and excessive loss.

In trading, you can not make right decisions to win all times so if you have bad trading capital management, like always use 100% of your trading capital to trade with one position. Some day, with over leverage and a bad day, bad position, you will get an excessive loss. This, if happens, will take away majority of your trading capital.

It can be the end for your trading career if you repeat it a few times and lose like 99% of your initial capital.

That is right. We need more money to burn in margin trading because this isn't simple as spot. This can increase our chance of earning, just like in gambling which @senyorito123 have also said. Not only more capital is the one that we can earn in spot trade but we can also obtain an experience here (on the general trading market) which is needed before advancing.

This is for us to get familiarize on some things and then the rest which are completely new to us can only or still be learned and practiced. There must also be demo trading there in margin just like in spot. We need to test our skills here first before going on the real deal.

Using leverage allows you to open more orders with different trading pairs and thereby reduce the risk. The incorrect use of leverage is that a trader opens an order for one trading pair for his entire deposit and eventually loses it.

And at the same time brings out the best advantage for those who are well-experienced traders as they can enhance their potential to make profits. So it’s actually a win-win scenario for both. But if you are still learning the process of trading, I suggest to avoid using leverage because it will only push your trading capital at an instant loss. However, for exchanges, they will always stick to what they’ll give them the best of their profits.

You are right about this!

But one way or another fees will have to be paid, if its not slippage that turns out to be high, expect spreads to be over the roof otherwise besides what the exchange adds as fees leverage increases our buying power which is a win-win for both exchange and traders as we can make more money from a small  capital injection !!

I disagree!!!

Leverage only gets bad when the trader has no working strategy and not using risk management to protect their capital!!

Truth be told, we have some may traders out there trying to get rich quick and what tend to happen is gambling and not trading..if we can work on getting a disciplined approach then leveraged trading will become a good concept for everyone.

I agree with you.

It's because we can not control the market and force the market moves to a direction that will help our trading positions end with profit so let's forget about it.

Another thing we can control is our emotion, greed, fear, panic that will all affect our trading action. However, unfortunately, when we use leverage, we will become more easily lose control of our emotion, greed, fear, panic, then will lose control of our trading action.

Bad control on our position will cause loss, hence if we are unsure that we can control these emotional things, we need to have prevention, don't use leverages.

Because of this, it is important for a trader to be able to understand risk management and how to take mitigation steps to reduce the risk of using leverage in their trading, for example using stop losses, choosing leverage that is not too high, and in-depth analysis of their trading to reducing the potential for dangerous positions for traders. Because leverage was developed to help traders, and if they understand the risks of using it and can make the best use of it for their trading, it should be a good tool for them in the world of trading.

I mean numbers aside, the idea is definitely a good one. I wish that there were a lot more newbies who actually did what you are suggesting here because that would be a great starting point. Obviously I would definitely suggest getting better at it and growing from there because every person would have their own preference on things and should be adjusting it according to what they enjoy.

However, we should probably consider the situation to be profitable if we know if this was the starting point and not really get it any where else, there are way too many problems because people end up with newbies who end up making a lot of mistake. This should be the key thing that you should expound and consider writing a whole topic about it so that newbies would have something we can refer to.

Leverage basically tells people "you could get very rich while risking lesser money but you could also lose all of it instead of just some of it". That is literally what all of leverage is. Instead of putting up 100k and hoping to make 5k profit, you invest 10k and hope to make 5k profit, that's amazing, but instead of losing 5% you may end up losing 50% instead and that's the risk.

Unfortunately, a lot of people lose instead of winning and that's the issue, too many people are taking way too much risk with this and we should consider why there are so many people who lose. I think one of the main reasons is that people lose because they are not aware of the risks involved with it and that is why they are not making that money back, I hope people go into leverage only after they know what they are doing.

Thankfully not a lot of people who understands how any of this works ends up losing money, it is all the newbies who should have stayed away to begin with, that ends up with a problem, and those should stay away anyway, and they still end up with something that causes them to just focus on something else.

I understand that newbies want to make money as well, but you can't just make money because you want to, and taking a huge risk like this doesn't guarantee you to make money neither. If you insist on this, and do it as a newbie, and then end up losing money, that's really not something I would be saying anything about, because you "sort of" deserved to lose that money, because you did something you shouldn't have done to begin with.