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What is the highest Bitcoin leverage ratio in 2021

Date:2024-04-10 20:33:01 Channel:Trade Read:
In 2021, the leverage ratio of the Bitcoin market once reached an astonishing 100 times. This number not only represents investors’ enthusiastic pursuit of high-risk and high-return cryptocurrencies, but also triggers a profound reflection on market stability and investment risks. Let’s dive into the story behind leveraged trading in Bitcoin, revealing the pros and cons, and how investors should deal with this risk.
The rise of Bitcoin leverage trading

The four most famous international exchanges:

Binance INTL
OKX INTL
Gate.io INTL
Huobi INTL
Binance International Line OKX International Line Gate.io International Line Huobi International Line
China Line APP DL China Line APP DL
China Line APP DL
China Line APP DL

Note: The above exchange logo is the official website registration link, and the text is the APP download link.

As a decentralized digital currency, Bitcoin has attracted much attention since its birth. However, its sharp price fluctuations have also attracted the attention of a large number of speculators. In order to obtain higher returns, investors began to use leveraged trading, borrowing funds to trade, making a small gain. As the price of Bitcoin continues to rise, leveraged trading has rapidly emerged in the market and has become a popular investment method.
The charm and risk of leveraged trading coexist
The charm of leveraged trading is that it can amplify investment returns and allow investors to obtain high profits in a short period of time. However, on the contrary, investment risks are equally magnified. Severe fluctuations in Bitcoin prices may cause investors to suffer huge losses or even liquidate their positions. Especially when the leverage ratio is as high as 100 times, investors need to always be alert to market changes to avoid falling into unbearable burdens.
A thrilling scene in the Bitcoin market in 2021
Looking back on 2021, the Bitcoin market has experienced a series of thrilling fluctuations. During a crash in May, many leveraged traders were forced to liquidate and suffered huge losses. This incident caused market turmoil and caused people to re-examine the impact of leveraged trading on the market. The high risks brought by high leverage force investors to re-evaluate their risk tolerance and trading strategies.
How should investors deal with high leverage risks?
Faced with the risks of highly leveraged transactions in the Bitcoin market, investors need to remain calm and rational. First of all, you must set a reasonable leverage ratio based on your own risk preference and financial strength to avoid risks caused by excessive leverage. Secondly, we must pay close attention to market changes, adjust trading strategies at any time, and guard against possible risks. The most important thing is to establish a healthy trading mentality, don't be dazzled by short-term profits, and treat every transaction rationally.
Conclusion

Before answering this question, the editor of Bitcoin Circle will first talk to you about Bitcoin leverage. Leverage is a common financial trading system, that is, the margin system. Leverage not only magnifies the amount that investors can trade, but also increases the returns that investors can obtain. and the risks taken increased. After understanding Bitcoin leverage, let’s get back to the topic. What is the maximum Bitcoin leverage in 2021? Below, the editor of the currency circle will talk to you about the multiples of Bitcoin leverage based on this issue. I hope that through this article, investors can have a preliminary understanding of Bitcoin leverage.

## What is the maximum leverage of Bitcoin in 2021?

In 2021, the maximum leverage of Bitcoin is 100 times, and the minimum leverage of Bitcoin is 5 times. For example, the maximum leverage is 100 times. OKCoin currently provides 10 times or 20 times leverage for BTC contracts, and 10 times or 20 times leverage for LTC contracts, so Bitcoin has the highest leverage. It is determined based on the exchange chosen by the investor.

## How to safely use leverage to speculate in Bitcoin?

1. Use low-cost leverage tools

The cost of borrowing for currency speculation comes from the interest on borrowing, which is 8% for stock financing, 4.5% for real estate financing, and more than 10% for Bitcoin financing. Obviously, the cost of financing Bitcoin speculation and adding leverage is very high, so currency speculation should choose futures instruments that have no capital cost.

2. Time period for using leverage

The cost of borrowing money to speculate is directly proportional to the borrowing time. The longer the borrowing time, the higher the cost. The concept of self-defense is to hide and wait patiently. Therefore, using leverage with interest costs can easily cause panic due to the increasing interest. chaos. In February 2015, I lurked long in Litecoin futures and went through a 3-month shake-up and finally caught the market price of 55 yuan. If I use financing leverage, then I will be anxious about the daily increase in interest and give up the long position prematurely. Therefore, the concept of self-defense in currency speculation is more suitable for using futures leverage tools.

3. Treat leverage multiples reasonably

Can you really use a 20x leverage tool 20x? Nature has redundancy, and our bodies also have redundancy. When the Bitcoin block reached 600kb, everyone was already discussing the issue of expansion. Because the world we live in is an uncertain one, in order to deal with possible fluctuations, we must leave enough redundancy to deal with unexpected occurrences. Therefore, the concept of self-defense in currency speculation is to set aside 80% of the margin to deal with possible accidents and reasonably ensure that the position is not liquidated.

4. Use profits to maximize leverage

Treat principal and profit differently. When you make a profit in the right direction, you can use part of the profit to gamble with the highest leverage. Make a desperate move to gain excellent returns while absolutely ensuring the safety of your principal.

Through the above introduction, I believe everyone has some understanding of the issue of the maximum leverage of Bitcoin in 2021. As we all know, the higher the leverage, the higher the profits investors can obtain, but at the same time, the risks investors need to bear will also change. Therefore, the editor of the currency circle reminds investors not to use leverage lightly, especially when they know nothing about leveraged trading. After all, the risk is too high and investors may not be able to bear it.

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