Cryptocurrency market is high volatile and not empty from risks. This is because the price movement are very fast because of the high volume. Keep in mind that trading in cryptocurrency is high risk and if not trade properly you will loose your money.
When it comes about leverage the risk percentage increases even more. Leverage is like using a tool or a strategy to make your efforts more powerful and effective. It provides you with more power then you have.
The definition according to finance is that borrowing money from others to increase your money power. Means that use others money for trading where you can earn benefit or ends with loss.
Where leverage option is available? This is the feature which is available in every kind of trading market, whether Forex, Crypto, Stock or any other trading market.
The only difference is in the leverage where some markets allows you with more leverage while some offers small leverage options. Just like #Crypto market is high volatile therefore it allows you with more leverage.
There are leverage options such as 1X,2X,5X,10X and so on until 125X in the future market. Also keep in mind that leverages are only offered in Future market where short and long trades are open.
Whereas in spot market you can't use leverage option which is why more safer and low volatile. I recommend to stay away from leverage because it is like that eats your money and you dont even realize it.
But for those who are familiar about leverage risks you can use any of the leverage option depending upon how much you manage risk. But the better one is to use 5x leverage which is low risk as well.
Leverage option is special for those who are expert in crypto trading and who knows about the basics and have enough knowledge about it.
If you are good at trading then the leverage feature is best for you and you can earn handsome money with your little money. Just like if you have only $50 for trading and you go for the leverage 10x, your money will convert to $500. Which means you borrowed money from others.
Now, when you are good at trading then you can earn money from the amount you borrowed. Just suppose you booked 1% profit will give you $5. Which is the 10% of your money and that is incredible.
Also the same is with the loss. If your trade goes wrong then you will book $5 from your capital money which is around 10% of your capital. That is why leverage option is too much risky and high volatile.
What do you think about leverage? Do you like trading using leverage option? Have you ever benefited from leverage or booked loss? share your experience in the comment section.
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