Topic: Beginners Should Avoid Leveraged Tokens Trading (Read 354 times)
Leveraged token trading carries a high level of risk. And of course most people prefer to invest in the short term. I don't like trading leveraged tokens because it's not an investment but a trade.
Leveraged token trading can be a risky investment strategy, especially for beginners. Leveraged tokens allow traders to magnify their gains or losses, depending on the direction of the market. this means that even a small price movement can have a significant impact on the value of the leverage token. For beginners, it is important to understand the risks involved in leveraged token trading before investing any money. While leveraged tokens can offer the potential for high returns, they can also result in significant losses if the market moves against you. Before investing in leveraged tokens, beginners should educate themselves on the market condition and trends. They should also consider their risk tolerance and financial goals before making any investment decisions.
This is not only a problem for newcomers to this market in trading but it also happens to those who have been in this market for a long time, I have personally experienced a lot of leveraged trades and also faced huge profits as well as many losses. What I learn here if I have done specific research, accepted the risks and earned profits, will begin, and over time I increasingly limit the use of leverage in trading, there are positive market periods, it is really good to use leverage to increase profits, but on the contrary, if we make a mistake and lead to failure, the psychology will lose control and will lead us to many different failures.
Leverage is a tool for experts, and the percentage of expert traders on any market is very limited, however exchanges promote the use of leverage as they know very well this will increase their profits whether the trader using leverage is successful or not.Which is why when I see an online ad of a cryptocurrency exchange they often promote themselves by the amount of leverage you can use on their platform, and many traders fall into this trap as they immediately picture themselves winning several trades in a row with a high leverage and somehow believe they can turn 1k into 1 million.
This is not only a problem for newcomers to this market in trading but it also happens to those who have been in this market for a long time, I have personally experienced a lot of leveraged trades and also faced huge profits as well as many losses. What I learn here if I have done specific research, accepted the risks and earned profits, will begin, and over time I increasingly limit the use of leverage in trading, there are positive market periods, it is really good to use leverage to increase profits, but on the contrary, if we make a mistake and lead to failure, the psychology will lose control and will lead us to many different failures.
Based on what I know, trading leveraged tokens can be advantageous for short-term gains, but it carries significant risks for long-term investments. Engaging in leveraged token trading can potentially yield substantial profits in volatile markets; however, it also entails higher risks. Leveraged tokens are specifically designed for short-term trades and might undergo price decay under specific market circumstances. It is recommended that traders conduct thorough research and comprehend the associated risks before venturing into leveraged token trading.
Futures trading is very high risk, and I am a trader who has been playing on spot since 2017 and tried to trade futures in 2021,
and as a result I earned $ 100 in 1 week and continued to earn after that I lost all my profits in just a few days and of course My capital was also subject to liquidation,
this is the importance of why futures trading has no choice for us old or new traders, the most important thing is being able to read TA and resist greed so you can succeed.
Even experienced traders do lose on average on leverage tokens. A newbie should only do spot trading, if a trader is skilled, futures can be considered given that the trader knows what he is doing. Leverage tokens trading is so risky that I didn't bothered trying it after knowing how it works. This kind of trading way isnonly effective on certain market scenario and in our current cycle, I don't think people can gain their expected profits from it. Spot trading would be the recommended in this kind of market scenario.
It's better not to trade anything with borrowed funds at all, especially for beginners. Beginners with any kind of leverage are likely to lose their money. If someone starts his way in trading, he should consider only spot trading and only basic assets, such as BTC, ETH, etc. Young projects with derivative trading possibilities are very unpredictable and can fall forever before they start to recover. In spot trading, you can wait for infinite amount of time, but in derivative trading, you can't sit in a negative position forever. Sooner or later a margin call will happen.
Leveraged tokens trading can be a risky and complex investment strategy, and beginners should approach it with caution. Leveraged tokens are designed to provide amplified returns based on the performance of an underlying asset, such as Bitcoin and Ethereum. They are also subject to significant volatility and can result in substantial losses if the underlying asset moves in the opposite direction of the leveraged position. For beginners it is important to understand the mechanics of leveraged tokens and the risks involved before investing. It is recommended to start with a small investment and gradually increase their exposure as they gain more experience and knowledge. Beginners should consider their risk tolerance and investment goals before investing in leveraged tokens. Leverage tokens are not suitable for all investors and may not be appropriate for those who cannot afford to lose their investment.
Newbies should not use any leverage, it is that simple, leverage is a double-edged sword, if you are successful your profits can be increased many times over and you could earn money that it would have been impossible with your current capital.But at the same time if you happen to make a mistaken prediction then your losses will be massive as well, and the only way to limit this would be by the use of a very tight stop loss and a solid risk management strategy, but if you are going to do that you might as well give up on using leverage at all.
Leveraged tokens trading can be a risky and complex investment strategy, and beginners should approach it with caution. Leveraged tokens are designed to provide amplified returns based on the performance of an underlying asset, such as Bitcoin and Ethereum. They are also subject to significant volatility and can result in substantial losses if the underlying asset moves in the opposite direction of the leveraged position. For beginners it is important to understand the mechanics of leveraged tokens and the risks involved before investing. It is recommended to start with a small investment and gradually increase their exposure as they gain more experience and knowledge. Beginners should consider their risk tolerance and investment goals before investing in leveraged tokens. Leverage tokens are not suitable for all investors and may not be appropriate for those who cannot afford to lose their investment.
My strategy is to pick the right projects, buy on the spot and wait. I only have one regret, I wish I had stumbled upon Cirus now. I never expected its price to get here, although it would have been better if the SEC hadn't sued.
I wonder if it is written on them that they are the right ones. Whether these projects are correct or not will be clear only after you buy them. A certain amount of time will pass and changes in the deposit will put everything in its place. The concept of token correctness is of course subjective, because someone can earn nothing on a known token, and someone, on the contrary, can significantly increase his deposit on some unknown token.
I have some investment in Leveraged tokens in Mexc exchange which are Doge5L, Eth5L. But I am astonished when I saw that my 35$ investment goes to almost 0. When Eth was around 1750 $ then I invested in EthBull but Eth now at around 1870$ but my assets are almost 0. I am holding almost 4/5 months are day by day it's decreasing though Doge and Eth pumped a little. So my request to every beginners who want to trade leveraged tokens don't hold it for long term as they are getting lower day by day. You can hold it for short term but I will suggest you not to do this. I think it's better to trade futures trading with low leverage than trading with these leveraged tokens.
I think the very first thing that comes to my mind is what were you thinking when you implemented such a strategy? As in my opinion you are doing everything wrong.You are trading shitcoins, using leverage and you are not cutting your losses and instead you are holding shitcoins for the long term, it is difficult to imagine someone doing more mistakes than you to be honest, so go back to the drawing board and think about what you want to do and do so for at least a few months, as the mistakes you made are so grave that remaining away from the markets for a few days or weeks is not going to cut it.
As dangerous as giving a 5 year old child to drive a car, not knowing the lack of skills in the process of using it, sometimes curious behavior will have unpredictable consequences. If you are new to this school, then cultivating user skills such as trading and financial management as well as data analysis should be a priority. Even those who are unfamiliar with this market without shortterm trading skills turn themselves into gambling addicts rather than traders, but in general this is part of the market and experimentation have to come with setbacks.
That has been my Big lesson since ever I trading leverage token in the Binance Exchange, been ETH UP, BTC UP, and some of other up and down as a leverage token, I Lost more than $500, while hoping to hold for a long term, that sudden turn to less than a dollar, after then, leverage token is a very high risk trading token to be trading.
Don’t ever trade those leverage tokens. You are better off just trading futures. They are very illiquid and horrible spread and since it’s a leveraged token you will have decay like an option pretty much.
The only good thing about these tokens is that you can withdraw them from the exchange and there is no counterparty risk since with future trading you need your maintaince margin in take exchange at least.
The only good thing about these tokens is that you can withdraw them from the exchange and there is no counterparty risk since with future trading you need your maintaince margin in take exchange at least.
These leveraged tokens for me are also the same as normal futures trading with leverage, though.
It's just sad that OP did this without proper knowledge, now it's lesson learned.
It's just good that the losses of OP is not that too big for them, because if the amount is way too much, it will really cause huge pain.
It's just sad that OP did this without proper knowledge, now it's lesson learned.
It's just good that the losses of OP is not that too big for them, because if the amount is way too much, it will really cause huge pain.
There's no easily earned money. Leverage trading could give you more but will cost you more if you happened to have the wrong position. There's no law prohibiting beginners to engage into this but atleast equip themselves with knowledge first 'coz they will just be gambling if they don't have any trading plan. There are many YT Channels in which they can learn from as well as people who shares their TAs. Regarding shared TA, it won't be enough basis 'coz that's subjective to who shared it. Your responsibility as a viewer is to analyze and validate the shared TA, and to come up with the decision whether to go along with his analysis or make on your own.
if someone who is not used to it, makes a mistake, or forgets to set leverage when opening a long or short position, the consequences can be fatal. When a trader uses leverage, they will be given a set liquidation limit. This liquidation limit is the specific price at which a trader's position will be automatically closed so that larger losses can be avoided.
If the creator of this thread didn't even aware or know about that and it will be useless. It can be seen that if he didn't even understand the true purpose of leverage token. He has been suffering the lose and what he can do to learn from his past experience. he shall not do another mistake again in the future. I hope he learn from his mistake.
if someone who is not used to it, makes a mistake, or forgets to set leverage when opening a long or short position, the consequences can be fatal. When a trader uses leverage, they will be given a set liquidation limit. This liquidation limit is the specific price at which a trader's position will be automatically closed so that larger losses can be avoided.
Base the op, Then I will also suggest that they should use Leveraged Tokens for trading and not for investment. Op your topic talks about "Leveraged Tokens Trading" and your content talks about investment so they are two different things all together. If one has long goal plan then he should go for investment but if the person wants instant cash out he should go for trading, and since Leveraged Tokens depreciating day by day then it is better for users to trade with it and not in investment
Strong price fluctuations along with the fees incurred during trading are problems that cause even professional traders to experience losses. So when you are inexperienced in trading, using leverage to optimize profits is just like hanging yourself. I don't recommend people to trade them often, but I know that optimizing profits with leverage can do great things, but if it's a balance between profit and risk on each trade responsible decision-making from the outset always requires careful consideration.
Begin time who comes early in crypto market and want to do trade and take some profit kindly always avoid leverage trade and i recommended always who new in crypto than starting with Spot trade at begin times as well.
That is indeed not an effective thing in terms of investment, no matter how good people in trade will not do that, it is indeed a silly decision to buy investment token leverage.
But with this, it seems that he learned his mistakes and became a knowledge in the trading of his trading, I think this experience is not so bad if he finds a lesson from his mistakes.
I also used to do that, but I did not do it for a long time like the OP did, only 24 hours but my money was lost somewhere, even though the price comparison was not so far.
Hopefully it becomes a useful knowledge or learning for OP, and does not repeat it again.
But with this, it seems that he learned his mistakes and became a knowledge in the trading of his trading, I think this experience is not so bad if he finds a lesson from his mistakes.
I also used to do that, but I did not do it for a long time like the OP did, only 24 hours but my money was lost somewhere, even though the price comparison was not so far.
Hopefully it becomes a useful knowledge or learning for OP, and does not repeat it again.
My first time to see that if there was someone who using leverage token as investment. Have you read what's the purpose from the leverage token before? I think that if you were reading it so well and you will not be ended in a loss.
Leverage token is far risky compared with futures trade but both can make you lose your money.
Leverage token is far risky compared with futures trade but both can make you lose your money.
Maybe some don't actually know what it entails further more before they badge into it, trading on itself has its own demands and risk while those that go on leverage trading do not have a good understanding of some of these conditions attached because they will not have the opportunity to make any readjustment while reading than to embrace the outcome that comes in after the trading, there's nothing to leverage on when trading than to get yourself the readiness for it right before you start trading.
My first time to see that if there was someone who using leverage token as investment. Have you read what's the purpose from the leverage token before? I think that if you were reading it so well and you will not be ended in a loss.
Leverage token is far risky compared with futures trade but both can make you lose your money.
Leverage token is far risky compared with futures trade but both can make you lose your money.
Despite the volatility, this token is not recommended in the long term as it is not allowed to be withdrawn. We do not know to what extent the exchanges will be fine, when they have failure at some point, these tokens can also become untrustworthy which can suddenly lose trading liquidity.
Trading in longer timeframes can be categorized as an investment, and it is recommended not to hold on to the exchange.
Trading in longer timeframes can be categorized as an investment, and it is recommended not to hold on to the exchange.
You cannot trade with margin and futures contracts with such ignorance, it is not trading in regular contracts and therefore you are restricted by a margin percentage and a certain date for closing the contract, otherwise it will be liquidated at a loss and therefore it is not long-term trading.
For long-term trading, you can start with spot trading, as it is easier and the orders are simpler.
For long-term trading, you can start with spot trading, as it is easier and the orders are simpler.
~snip~
You must have been warned by the exchange when you went to buy the leveraged tokens. You have agreed to that warning and bought the tokens. So it is entirely your responsibility. You can't blame anyone for that. Just as trading with leverage is high risk in futures trading, buying leveraged tokens is also high risk in spot too. You should have stayed away from them. there are a lot of potential tokens in the market where you could have gotten something better and at least you could have avoided such a big loss even if you had lost some. 
Alright, let's get something straight: these crypto tokens, they're pretty much the honey badgers of the digital coinage biosphere, unyielding and wildly erratic. Quicker than you can utter "blockchain," they can evaporate your investment capital. Your adventure, is an unadulterated portrayal of 'decay', which, in the financial lingo, signifies "the marketplace swiped my assets whilst I was occupied toasting to DOGE's rate climb."
However, don't get it twisted. Leveraged tokens aren't universally appalling. They resemble those ludicrously hot chicken wings you find at a local bar. While they may not be for everyone, there's a certain subset of risk-loving individuals who savour the rush. To the novices out there, here's a piece of advice: steer clear of leveraged tokens unless you're well-versed in their workings. Failing to do so is akin to showing up at a firefight armed with only a butter knife!
However, don't get it twisted. Leveraged tokens aren't universally appalling. They resemble those ludicrously hot chicken wings you find at a local bar. While they may not be for everyone, there's a certain subset of risk-loving individuals who savour the rush. To the novices out there, here's a piece of advice: steer clear of leveraged tokens unless you're well-versed in their workings. Failing to do so is akin to showing up at a firefight armed with only a butter knife!
Margin trading should be avoided if possible by everyone, not just beginners. This is the fastest way to lose money. In a spot, you can sit in a negative trade indefinitely, but not in margin trading. In addition, the cryptocurrency market is very volatile, and without margin trading, you get excellent percentages of profit. The only thing worse than margin trading can be margin trading in altcoins or some outright shitcoins, like memcoin PEPE or NFT.
Makes sense, Xal0lex. Beginners and anyone should avoid it if they have no expertise in margin trading.Not everyone will lose money on margin trading, but most will because of a lack of experience and knowledge. Crypto markets fluctuate all the time and maybe they need to avoid the high risk of loss from margin for some other types of trading such as spot trading.
Even so-called experienced traders also lose money on margin trading. Not everyone will lose money, but almost everyone will lose their money, because the volatility is very high, even bitcoin sometimes loses 50% of its price in a day. I am always amazed at the amount of liquidations during the next flash crash, traders' deposits are liquidated for billions of dollars, which means losses for almost everyone, both beginners and experienced.
WTF are you doing? you have almost zero knowledge about that and why were you still picking it? leverage token was only for people who are looking for a very high volatility. Future was a bit easy compared with leverage token as it's not as volatilt as leverage token.
It's only amateur who used leverage token for long term investment.
It's only amateur who used leverage token for long term investment.
Everyone should avoid token trading, it's a heavily manipulated market for trading hot air. There is not fundamentals here, tokens go up and down purely because of hype and manipulation, not because they have utility. Leveraged trading should also generally be avoided, only a small 2x or 3x leverage makes sense when you are experienced trader who trades a solid asset like Bitcoin.
Trading with Mintable tokens is risky and more risky than Proof of Work coins. Tokens can be minted by developers but Proof of Work coins can not be minted but only can be mined with time by miners.This topic discusses about a more risky thing, trading with leveraged tokens. With leverages, it is bigger risk than with tokens in Spot trading.
Tokens are usually useless in utility and have very high in their inflation so token price mostly will decrease with time. Like the US. dollar, fiat currencies have their decreasing purchasing power with time, inflationary tokens will have decreasing prices with time.
If you hold those tokens, you lose.
If you trade those tokens with leverages, like Short you will be killed by bounces.
If you trade them with leverages for Long, you will be killed by market fud, token crashes.
Everyone should avoid token trading, it's a heavily manipulated market for trading hot air. There is not fundamentals here, tokens go up and down purely because of hype and manipulation, not because they have utility. Leveraged trading should also generally be avoided, only a small 2x or 3x leverage makes sense when you are experienced trader who trades a solid asset like Bitcoin.
Margin trading should be avoided if possible by everyone, not just beginners. This is the fastest way to lose money. In a spot, you can sit in a negative trade indefinitely, but not in margin trading. In addition, the cryptocurrency market is very volatile, and without margin trading, you get excellent percentages of profit. The only thing worse than margin trading can be margin trading in altcoins or some outright shitcoins, like memcoin PEPE or NFT.
Makes sense, Xal0lex. Beginners and anyone should avoid it if they have no expertise in margin trading.Not everyone will lose money on margin trading, but most will because of a lack of experience and knowledge. Crypto markets fluctuate all the time and maybe they need to avoid the high risk of loss from margin for some other types of trading such as spot trading.
Margin trading should be avoided if possible by everyone, not just beginners. This is the fastest way to lose money. In a spot, you can sit in a negative trade indefinitely, but not in margin trading. In addition, the cryptocurrency market is very volatile, and without margin trading, you get excellent percentages of profit. The only thing worse than margin trading can be margin trading in altcoins or some outright shitcoins, like memcoin PEPE or NFT.
Beginners have no business using leverage while trading or playing around with futures. It is very easy to have your share vanish while trading if you do not know what you are doing.
If you are not absolutely sure of what you are doing then avoid putting money into it.
- Jay -
If you are not absolutely sure of what you are doing then avoid putting money into it.
- Jay -
Yet alone leveraged tokens, you should also avoid Futures. It's a similar concept with leverage of up to 100x for every Crypto asset available in the market.
Here is the Liquidation data for the past 24 hours: https://www.coinglass.com/LiquidationData
In the past 24 hours, 98,577 traders were liquidated, the total liquidations come in at $274.18 million.
Here is the Liquidation data for the past 24 hours: https://www.coinglass.com/LiquidationData
In the past 24 hours, 98,577 traders were liquidated, the total liquidations come in at $274.18 million.
So my request to every beginners who want to trade leveraged tokens don't hold it for long term as they are getting lower day by day. You can hold it for short term but I will suggest you not to do this.
Trading and investment are different.Why you are in a trading position but holding your token long time? When you don't know what you are doing, you can not manage risk and liquidations will come.
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I think it's better to trade futures trading with low leverage than trading with these leveraged tokens.
Trading with Futures is another bad choice from you. By trading with Leverages, Leveraged tokens, Futures, you are making exchanges richer but making yourself poorer.If you trade, trade with Spot only. Never click on Future, Leverage tabs and click on Agree to their terms to activate those trading tabs. After you activating those tabs, it will be very hard for you to control your greed and not use those derivative trading tabs.
I have seen this on Kucoin and Bybit. If you want to trade leverage token on both exchanges, you will see a warning, about how it should be used for short time trading and how risky it is.
On Bybit:
On Kucoin:
If you click on the product information on Kucoin, you will see better explanation.
Is it not like that on MEXC too?
The exchanges I see such tokens, there are always warning about it.
On Bybit:
On Kucoin:
If you click on the product information on Kucoin, you will see better explanation.
Is it not like that on MEXC too?
The exchanges I see such tokens, there are always warning about it.
I have some investment in Leveraged tokens in Mexc exchange which are Doge5L, Eth5L. But I am astonished when I saw that my 35$ investment goes to almost 0. When Eth was around 1750 $ then I invested in EthBull but Eth now at around 1870$ but my assets are almost 0. I am holding almost 4/5 months are day by day it's decreasing though Doge and Eth pumped a little. So my request to every beginners who want to trade leveraged tokens don't hold it for long term as they are getting lower day by day. You can hold it for short term but I will suggest you not to do this. I think it's better to trade futures trading with low leverage than trading with these leveraged tokens.
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