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How to use leverage to trade in the cryptocurrency market?

What does leveraged trading mean in the cryptocurrency market? Leveraged trading amplifies the principal amount several times, allowing for larger investments with smaller capital, achieving high returns with low investment. However, one must also bear the risk of potential losses being amplified. Due to the high volatility of digital asset prices, please be sure to fully understand the risks of leveraged trading before using it cautiously.

How to use leverage to go long and achieve doubled profits?

Taking BTC/USDT as an example, if the platform supports a maximum of 3 times leverage. When you judge that the price of Bitcoin will rise from 10,000 USDT to 20,000 USDT, you have a principal of 10,000 USDT, and you can borrow a maximum of 20,000 USDT from the platform. Use 30,000 USDT to buy 3 BTC at the price of 10,000 USDT, and then sell at 20,000 USDT, earning 3 BTC * (20,000 - 10,000) = 30,000 USDT. If you only trade with your own 10,000 USDT, you can only earn 10,000 USDT. Using 3 times leverage, your returns are tripled!

How to use leverage to short and make money when the price drops?

Taking BTC/USDT as an example, if the platform supports a maximum of 3 times leverage. When you judge that the price of Bitcoin will drop from 20,000 USDT to 10,000 USDT, you have a principal of 10,000 USDT (0.5 BTC), and you can borrow 1 BTC from the platform, selling 1 Bitcoin at the price of 20,000 USDT, and buying it back at 10,000 USDT, earning 10,000 USDT. If you only trade with your own funds, you can only buy low and sell high, without the ability to short. 19990276598

What are the risks of leveraged trading? 44197002920

Leverage allows the potential for larger profits with less capital. However, if the wrong trading direction is judged, the losses will also be proportionally amplified. Therefore, ordinary traders should try to avoid high-leverage heavy trading to prevent liquidation or even negative balance.

How to reduce leverage risk? 81213057238

1. Use leverage ratios reasonably and control positions.

2. Take profits and stop losses in a timely manner, and close positions voluntarily. 25186645977

3. Add margin in a timely manner to ensure that the ratio of total assets to leverage amount is greater than 110%25186645977

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