Leverage trading will either crush your account or shoot it into the stratosphere. If you are comfortable with this knowledge and the risk of leverage trading crypto, read on. If not, bye for now.
What Is Crypto Leverage Trading?
[Breif Explanation Below]
Leverage trading is borrowing money from the broker or exchange so that you can trade with it. You have to pay this money back regardless of whether your trade is successful or not.
The way that it works is that you deposit a set amount into the trading account and you can borrow a certain amount to "leverage" your position in the market. For example, if you deposit $1,000 and are offered 100x leverage, you will be able to make a trade with $100,000.
The Best Crypto Leverage Trading Platform?
There is no such thing as a "best crypto leverage trading platform" and anyone that says otherwise is likely trying to make a buck off of you!
The so-called "best" platform is really just an arbitrary choice because there is no Olympics or World Championships of trading platforms with a set of arbiters or judges that can define one as the winner!
Some people may define "best" as the platform which offers the highest amount of leverage, while others will argue that more markets (coins offered) and better support are what defines it as the best. Your best is different from my best and vice versa.
Know this: many websites and video producers offering advice on this same topic are affiliated with the platforms that they claim are the best. Usually, these bloggers and YouTubers are earning affiliate commissions in return for telling you about the platform. They are being paid for the recommendation and in my view, you are not going to be given the best information, instead, you are being given a recommendation solely based on the fact that the blogger or YouTuber is being paid to do it.
With that said, I've looked at a number of different cryptocurrency platforms that offer leverage and the following is the one that I think deserves to be called THE BEST. It's not based on anything other than my own UNPAID opinion.
#1 Best Crypto Leverage Trading Platform: Binance
I don't even use or recommend Binance on the resources page of this website because I generally dislike the platform, specifically, how long it takes to set up an account and pass their KYC process as well as some other pet peeves that I have, but when it comes to the question of leverage trading, you probably can't find a better option in all honesty. And I say that with gritted teeth.
Binance is the world's largest exchange, not just by one metric, but many! Binance hosts the most amount of daily cryptocurrency volume, it offers the most markets and supports the most fiat currencies.
When it comes to leverage trading, Binance offers margins for over 600 trading pairs, as well as cross-margin trading and isolated-margin trading options.
The process to get set up with Binance appears to be simple enough with Binance stating that it is a short 4-step process as shown below (this assumes you already have an account).
You can check the Binance Margin Data page here for information on the interest amounts and limits as well as price index info.
The max amount of leverage appears to differ depending on the pair, which is how most platforms offer this service. Binance offers up to 125x leverage as their max on its BTC-USDT pair.
Why Is Binance the Best Crypto Leverage Platform?
Again, this is an arbitrary decision and it's an honest one.
Click on other websites or videos offering to answer this question for you and you will notice the same exchanges and brokers continue to be recommended (BYBIT is one of the more popular ones with affiliate marketers) and that is because they are being paid.
My reasons are that Binance has a bunch of documentation, videos, terms, rules, and more when it comes to leveraged trading. This tells me that they are doing their best to go by the book and make sure that their traders and investors know what it is that they are doing and the risks that they are taking when engaging in high-risk trading, and this is one of the top reasons that I give them the top spot.
You have to understand something. Leverage trading is really, really risky. It's one of the riskiest things that you can do because you're essentially multiplying your risk/reward with other people's money. It's so risky in fact that Americans are banned from crypto leverage trading on most platforms!
Talk to any trader or ex-trader as a matter of fact, and they will tell you, the honest ones anyway, that they have been ruined by leveraged margin trading. And this is where Binance appears to me to differ from many of the other crypto trading platforms that offer leveraged trading options.
Here are just two quotes from Binance on the topic:
Binance Margin Trading grants eligible users access to funds from the Binance Exchange for use in leveraged trades. Experienced traders looking to increase their buying power can use the Margin trading feature to amplify potential returns on long or short positions. However, leverage trading, including margin trading, involves high risks as it could potentially amplify trading losses as well. With the risks involved, it is good to always do your due diligence and read up on the pros and cons before you start leverage trading.
High returns are usually accompanied by high risks, and this is true for margin trading as well. While returns are potentially amplified, potential losses are also multiplied if the tide is not in your favor. With leverage trading, losses can be very damaging for your portfolio as your market exposure is increased. Unlike regular trading, margin trading could result in losses that exceed your initial investment–even a small drop in the market price can be amplified and cause significant losses.
These are just two quotes that I have taken from the Binance blog here, on the topic of leveraged trading. Binance has many pages, terms, policies, videos, and posts all dedicated to explaining and teaching its users and clients about leveraged margin trading which says a lot in my opinion.
The other boxes that Binance ticks for me are liquidity, security, and education. Binance has the highest liquidity of all exchanges, it has great security (even though it has experienced hacks in the past) and they have a great education portal teaching traders all about trading and investing.
If you are going to trade with leverage, you know the risks and understand what it is that you are doing, do yourself a favor and do it with a platform that knows what it's doing, is licensed, is responsible, and one that repeatedly tells you; leveraged margin trading is risky business!
Other Crypto Leverage Trading Platforms
Below is a short list of cryptocurrency exchanges or brokerages that offer leverage trading options. There are many others that exist, this is not a complete list of firms that offer leveraged products. For that, you'll have to navigate away from here and to other websites that make money by referring you to all sorts of affiliate schemes (sorry, couldn't help myself).
This is a P2P crypto products trading platform that offers 200x leverage which is the most amount of leverage currently offered in the crypto markets and is the only reason I mention it here.
These guys offer 100x leverage on some of their products and were one of the first ones to promote margin trading in the crypto space with their Bitcoin margin trading products.
Like Binance, Kraken is huge, they are well known with many users, lots of liquidity, and many different coin markets and they are secure. Currently ranked #4 exchange by CoinMarketCap. Kraken offers 5x leverage. The additional benefit to using Kraken is that if you are from the US, you are allowed to use their leveraged margin trading option.
The benefits of leveraged cryptocurrency trading are clear, it's a high-risk, high-reward way of trading where you can earn insane amounts of money quickly, but the same works in the opposite way, you can lose all of your money AND have a debt to pay off to the exchange or broker.
Be careful, only invest what you can afford to lose. "Best" does not mean you are protected from loss, it is just an arbitrary term.
And last but not least, virtually all other websites, articles, and videos claiming to provide you with the answer to this question are all shilling for crypto exchanges that are paying them to advertise their crypto leverage products and service. You've been warned.
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