About BTCC Leverage-Beginner’s Guide

Leverage trading increases potential earnings and dangers by enabling traders to open larger positions with less cash. Offering up to 500x leverage on specific trading pairs, BTCC is one of the top cryptocurrency exchanges for leveraged trading. Because of this, traders who want to increase their market exposure find it to be a compelling platform.

What is the Leverage?

Bitcoin leverage enables investors to gain maximum exposure to Bitcoin volatility with a little initial commitment, known as margin. Margin is defined as the amount of money that must be deposited into your account in order to achieve a given level of leverage.

For example, 20:1 leverage allows you to trade $5,000 in Bitcoins with a $250 margin deposit. If Peter purchased $30,000 in Bitcoins at $5,000 per BTC and the price increased to $6,000 three days later. Without using any leverage, Peter will make $6,000 in Bitcoin trading. However, if Tom utilizes 20:1 leverage, he only needs $1,500 in margin to trade $30,000 in Bitcoins and profit $6,000.

Leverage trading is a two-edged blade that can enhance both your earnings and your losses. Using the preceding scenario, if the price of BTC falls to $4,750, Peter will lose $1,500 and have $28,500 remaining. In a leveraged deal, however, Tom will lose all of his margin deposits.

Bitcoin’s price is extremely volatile; it is not unprecedented for BTC to fluctuate by more than 30% in a single week. It is critical to carefully select the level of leverage that is appropriate for your risk tolerance.

For instance, Peter and Eric each have $5,000 in their accounts. The Bitcoin price is currently trading at $7,000. Peter is upbeat and chooses to open a $200,000 BTC transaction with a leverage of 40:1. While Eric is cautious about the consequences of high leverage, he enters into a $25,000 BTC transaction with a 5:1 leverage. If the price of Bitcoin falls by $100 to $6,900. Peter will lose $4,000, leaving him with $1,000 in his account. Eric, on the other hand, would have lost only $500 and would still have $4,500 in his account balance.

It is critical to understand that margin levels are not fixed and change over time depending on the price of the item being traded. If you hold a long position and the asset declines in value, you will receive a margin call informing you that you must deposit additional funds known as maintenance in order to keep your margin level. If you do not deposit more funds, your account will be liquidated.

In terms of liquidation. Many cryptocurrency exchanges have a widespread practice of covering someone else’s negative balance with “insurance money,” which are made up of other users’ balances.

One of the unique features of BTCC is negative balance protection, in which the exchange will cover the user’s negative balance entirely rather than forcing the user to liquidate or having other users share the losses.

/ You can claim a welcome reward of up to 10,055 USDT🎁\

How Leverage Works on BTCC

By using leverage, dealers can borrow money from the exchange to trade a position that is larger than their initial investment. The margin—the trader’s deposit—serves as collateral for the leveraged transaction.

For instance:

A trader can open a $10,000 position with $100 if they employ 100x leverage.

They can control a $50,000 position with the same $100 deposit if they apply 500x leverage. Higher leverage, however, raises the danger of liquidation because a trader could lose all of their margin if the market swings against their position.

BTCC’s Leverage Choice

In order to accommodate varying risk appetites, BTCC provides customizable leverage levels.

• Users have a range of leverage options, including 5x, 10x, 50x, 100x, and up to 500x.
• Accessible on a number of important trading pairs, including as ETH/USDT and BTC/USDT.
• Options for isolated and cross margins to improve risk management.

Note: Higher leverage should be handled carefully because it raises the danger of liquidation as well as potential gains.

How BTCC Compares to Its Rivals

One of the biggest leverage ratios in the business is 500x for BTCC. This is how it stacks up against other significant exchanges:

High-leverage trading at BTCC is intended for seasoned traders who are aware of the dangers and benefits of margin trading.

• Fiat Deposit. Buy USDT using Visa/Mastercard (KYC required).
• Crypto Deposit. Transfer crypto from another platform or wallet.