Today, I must discuss two particularly crucial concepts in cryptocurrency trading with you—full margin and isolated margin! Although the names differ by just two characters, the actual

The difference in operation can be huge, especially regarding the impact on our wallets, which is not trivial.

Let's first talk about the full margin mode, which basically means all the money in your account, regardless of whether it's the principal just deposited or the profits made before.

When operating in this mode, all your positions are treated as part of a 'big pool', and all the money used for margin comes from this pool.

is like putting all your savings in one drawer at home; whether it's for buying groceries, paying rent, or enrolling your child in tutoring.

Everyone takes money from this drawer; how much you spend depends on how much is left in the drawer.

The benefits of this mode are very obvious, the utilization of funds is extremely high! For example, if you believe a certain coin will rise and you open a long position, this

If at another time, another coin accidentally drops a bit and you incur some losses, it’s okay; the profits you made earlier or other funds in your account can

It can help you bear some losses; as long as there is still enough money in the big pool, you won't have to worry about this small loss causing you to get liquidated.

In trends where the market is particularly clear, such as during a bull market, full margin is very useful, allowing you to maximize your funds.

money utilization, earn more.

But its risks must also be mentioned; the fear is a market 'roller coaster'. If you have added high leverage, for example, 20x,

50 times, suddenly encountering a market crash, all positions suffer losses together, then the money in the entire pool may be almost depleted in an instant.

In severe cases, it may even lead to negative balance, meaning you could lose more than your principal, at which point the exchange might liquidate all your positions to stop the loss.

If all positions are closed, it would be truly heartbreaking.

Now let's talk about isolated margin mode, which is easy to understand. The margin for each trade is independent, each manages its own, and they do not affect each other.

When you open your first trade, set aside 1000 as margin, regardless of whether this trade makes or loses money, it only relates to this 1000.

it only relates to that amount and won't affect other funds in your account.

The biggest advantage of this mode is that it isolates risks very well! It's suitable for those who like to try new strategies, for example, if you want to test

For short-term contracts, or using small funds for a trade, even if this trade incurs a loss, it won't affect your other positions and funds, effectively giving you

Your wallet has a 'safety lock' on it.

Moreover, its leverage is particularly flexible; you can set 5x leverage for one trade and 10x leverage for another, completely based on your own judgment.

to maximize your funds and earn more.

However, isolated margin also has its headaches, as it has weaker risk resistance. Since the margins are independent, if the market goes against you,

If it goes the other way, and the margin for this trade is almost lost, it won't find money from elsewhere to make up for it; it will directly get liquidated.

The margin could be lost in an instant, so when using isolated margin, you must calculate if your margin is sufficient and not be too impulsive.

If you are particularly confident about the upcoming market, for example, feeling that a bull market is coming, you might want to utilize all your funds to earn more.

If you want to maximize your returns, then using the entire account is definitely the first choice, allowing your funds to have the greatest effect.