#Circle扩大IPO规模 , Leverage, and Contract Trading Methods Have Essential Differences in Asset Ownership, Source of Leverage, Settlement Mechanisms, and Risk Structures.

1. Spot Trading

- Core Logic: Instant buying and selling of actual assets

- Leverage and Risk:

- Leverage Ratio: 1x (no leverage)

- Maximum Loss: Principal goes to zero (when asset price drops to 0)

- Typical Scenario:

> Buying 0.025 BTC for 1000 USDT, if BTC rises to 45,000 USDT, profit of 125 USDT (25% increase).

2. Margin Trading

- Core Logic: Using spot assets as collateral to amplify principal

- Leverage and Risk:

- Leverage Ratio: 2-100x (platform's set limit)

- Liquidation Mechanism: When the value of the collateralized asset ≤ loan principal + interest, automatic liquidation is triggered.

- Maximum Loss: May exceed principal.