500x leverage necessary?

[tvplus006]

It should be understood that high leverage is beneficial only to the exchange, since its use by a trader increases the volume in the deal, which entails increased commissions for the exchange when opening and closing a deal by a trader. In case of order liquidation, which is almost 100% with increased volatility, the exchange also receives an increased percentage for closing a position.

[JeffBrad12]

You underestimated the greed of all those degens who sees 500x leverage and thought, "Yeah, i'm gonna turn my $50 into $100k with this" and getting margin called 5 minutes later.
Those kind of people exist and the sole reason why 500x leverage exist to begin with. Some shady exchange has been doing this for a long time because its profitable.

[SquallLeonhart]

It should be understood that high leverage is beneficial only to the exchange, since its use by a trader increases the volume in the deal, which entails increased commissions for the exchange when opening and closing a deal by a trader. In case of order liquidation, which is almost 100% with increased volatility, the exchange also receives an increased percentage for closing a position.

As far as I know, it's just about the fee for them, so it doesn't matter if you win or lose, they get their fee one way or another. If you do 500x and win big amounts of money, they still take their fee, they do not need you to lose, that doesn't matter to them. Because while you may do this, there is someone on the opposite side doing the same thing.

Think of it like sports betting, they give you a chance for team A to win or Team B to win, people bet on both sides, and no matter who wins, the bookie wins. Same for exchanges, if they give you an option, doesn't mean that you are trading against them, they are not putting up the money for you to win or lose, if you win they are not the ones who are paying up.

[Bobrox]

500x leverage in future trading? Its sound crazy for me as usually trading at future with leverage around 10x to 20x never using up to x100 although the MEXC exchange right now giving offer crazy leverage. Firstly trading trough leverage have high risk than spot trading how come use 500x leverage most make close with liquidation no matter what kinds coins you open long or short position, in my opinion using high leverage for future trading up to 500x purely gambling and speculating about trading get profit or loss.
You can check MEXC exchange there are many crazy leverage offering than other exchange but must prepare high risk later, I see my friend interested using that exchange and sometime show us about their trading future with leverage above 500x but too close for liquidation.

[LastKiss]

~snip~
Should these high leverages even exist?

Well, I think it targets people who want to gamble their money using high leverage. Many of them are tempted to use small capital with high leverage and combine it with technical analysis before placing a position. It’s not really necessary, it’s just for a different market segment and I guess for CEX it might even be free money for them.

I once read a post from someone who used high leverage and he clearly didn’t understand why his money was gone when the price hit his liquidation level. It made me question whether these people really understand the risks and consequences because they seem to just click blindly, thinking they can get rich overnight.

[Mpamaegbu]

Should these high leverages even exist?

I believe there are traders who ask for such leverage, and who also take it. Yes, it's a huge risk but then there are traders who are dangerous risk takers. Again, that will also depend on one's capital before one can justifiably use such leverage.

For me, I wouldn't take such risk; no matter what capital I've. I consider it gambling. Even when I know trend direction, I still won't do that. Spikes do happen. It doesn't matter the direction of the market. A bullish trend can have spikes downward and vice versa. One may decide to place a trade to scalp it on that leverage and a fast spike takes one out and wipes out one's capital.

[_act_]

I believe there are traders who ask for such leverage, and who also take it. Yes, it's a huge risk but then there are traders who are dangerous risk takers. Again, that will also depend on one's capital before one can justifiably use such leverage.

Even regardless of the the amount of money someone is having, going for 500 to 1000x is too much and it is just gambling and no more trading.

Exchanges just like people to always lose so that they can gain more and which is bad. Also the high leverage means high amount of money used by the traders to trade and lose.

It doesn't matter the direction of the market. A bullish trend can have spikes downward and vice versa. One may decide to place a trade to scalp it on that leverage and a fast spike takes one out and wipes out one's capital.

You get it, many traders are not preparing for something like this. The traders money will be liquidated but the price of the coin will later go to the direct of their trade. High leverage is very bad.