Topic: Do not use more than 2x leverage (Read 562 times)

The problem is that people who do 10x have very little chance to stay, but also more than 150x people as well. In an example, if you have 10 thousand dollars, and you want to do 10x, that means you will be acted as if you invested 100k, so by logic if it goes to 90k, you are gone, that means 10% drop makes you lose it all, but at 100x for example, that 10k will become 1 million, and you will lose it all at 990k, so even 1% would make you lose it all. That's the difference and this is why 10x sounds better.

Obviously at 2x, you would need to lose 50% to lose it all, hence it's much better but 10% feels alright risk for some people. At worst case, they think they can get out before they can lose it all, or top the margin a bit more to lower the risk.

You can use 150x and make profit too, if you can of course, the amount you are leveraging is not the problem here, you can use any type of amount and make any kind of profit, that is never the point. I think it is quite important to remember that we are going to lose a lot more quicker if we are wrong, that is the point of it.

I hope that it could get to a level where we could make some good return from it and 150x or 2x we both all win, but when the price is going the opposite direction, I rather be at 2x than be at 150x, that would make sense. I mean margin-wise, you can cover 2x very easily, whereas you can't really make that 150x at all. So, yeah there are people with 10x who make profit, but there are also many who doesn't.

Well, here, of course, it is very contradictory, if x2 then the profit is x2, if you know how to trade futures, then you can play with the best leverage. The X2 shoulder is, of course, as close as possible to the spot, so to each his own, each has his own path.

For long term trading it is very effective to gain  good profit. you can't make profit in short time every time. many time you have to wait long time to make profit by trading like you mentioned so high leverage is soo risky. so i agree with op we shouldn’t take more then 2-3x leverage for safe trading. if we take high leverage like 10-125x then our balance can move to 0 in very short time and our trading fund will Liquided. so 2-3x is much better for safe trading

I think that high leverage is mainly used by beginners, and this is due to the desire to make a big profit faster, without having a sufficient deposit for this. And if you add to this desire a lack of knowledge and experience, then this 100% entails the loss of the deposit.

Investing and trading using leverage may also involve a higher amount of risk hence, it's obviously discouraged most especially for those who are still starting to trade or invest in the market.

But I believe for those who are eager enough to use leverage, then most probably they are also responsible to deal with its associated risk. If they can manage the risk and use leverage wisely, then most likely they're actually determined to use it successfully. With that, there's nothing we can do but to have faith in them that they can really make it in the end.

There’s nothing you can do if that certain investor wants to take higher risk by using leverage. I guess that’s not actually wrong to use leverage if you are capable enough to manage it, since the more you put leverage into your trade or investment, the bigger profit opportunity you will gain. But if you are a pleb in crypto, I suggest don’t bother using leverage since it will only push you and end up losing. Gain some knowledge and skills first so you can use leverage in the future and make it an advantage.

You are saying right. Must use low leverage and take a trade when you are sure about the trade. Taking high leverage is really risky.
Firstly I don't prefer to take leverage trading. Because it is risky when you are beginner. Start with spot trading. But if you really want to start then start with very leverage is not so risky.
And put your spot limit at 10% loss.

The tricky problem is people will increase their input capital from $1 to bigger like $50, $100 and more but they don't reduce their leverage.

When you are familiar with using leverages, you are like leverage addictive and you become a gambler, no longer as a trader or investor. Gambling with leverage is risky in this volatile market and with 125x leverage, a price change less than 1% can liquidate your position, so is it safe to use, even with $1?

Don't think like if you use $1, you will lose only $1 because after 100 times, you will lose $100.

125x leverage with $1 could actually make quite good profit if done consistently and each day is being done few times. after all if worst goes to worst we only lose $1 people with big money have the advantage to spot trading because small increase is already good enough profit for them frankly speaking its different with small money traded we can be waiting for a whole year to wait for coin to increase 50x and we only get $49 its i don't think really good thats why so many small shrimp trader usually leverage high and that honestly make sense enough
i personally sometime use really high leverage with small money traded for fun and also when some project i think have obvious pattern of dumping or pumping i will just jump in to the future trading  and do some good trade with high leverage.
eitherway, there is no wrong in using high leverage as long as we conscious enough to not go all in.

I used 20x leverages for small capital when trading Bitcoin and for trading Altcoins, I stay away from using leverage cause I once traded altcoins with leverages and got liquidated in just a day lmao. for big capital it's better for me to trade without any leverage cause mostly I hold it for the long term and waiting the best price to sell. As long as we know the risks it's up to someone if they want to use low leverage or high leverage. 

There are people that are using 10x leverage. What do you have to write about them and they are making profits from the market.
It is good when we understand what leverage really means and how we could leverage without hurting our account.
We need to take risk and when we win, people would call us successful. Understanding how risk works is a first step for us to be a winner in the market. We can always make money for ourselves without bothers.

Basically what you are doing is to make very few dollars. For those people who have a lot of investment, they wait for about three days, four days, five days, sometimes even a month. So I think it's better because it has a lot of benefits because they're giving you a loan, right? will get more benefit if you have thinking about a good future trade.

I think Vitalik Buterin should keep his advice to himself, people have the right to their money and they can use it as they like depending on their risk affinity. Even as he prefers that people do not use more than 2x, many people will prefer to stick to 1x, while some will use way more than 2x depending on the money they have in their accounts. He can't tell me to have $50 in my account and still stick to his uninformed advice of using the leverage of 2x. How much will I be making with that amount if the market is not so encouraging in movements? If I do not want to invest, I will know I am idle of it instead of wasting my time and energy over it.

This is not to mention those who have a lower amount of dollars in their crypto accounts. This is why I think his advice is just nonsense and rich-incline as trading advice should not be general. Investment advice should be based on factors, and in this case, if he is wise, he would have added an account size to it to be more constructive to justify his advice. You can think of it, if you have $5 in your crypto account, can you still follow his advice? We plan trading and investment based on our expertise and the amount we have, for me, it can't be general.

people with low amount of money to begin wind tend to over leverage because they feel there's nothing to lose here, just some measly money can be earned by working but the chance of getting rich is in front of our eyes of course i will call such behaviour too reckless because some altcoin market are too full of manipulation, when there are many futures ready to be liquidated, they will change the tide of the market, to force liquidate all these derivates orders and bet against them.
thats what happening sometime i think with derivative being affected greatly by sudden move in spot market. im sure you've also seen plenty of altcoin that suddenly increase at correction and suddenly dumps at rally.
i think it has something to do with the fact that there are effort to force liquidate all the derivative contracts in some random altcoin with relatively low market capitals.

It is not for everyone and that's why he's advising to just go on a safe route with minimal risk.

Stay on the spot and don't do leverage. Whether it's 2x or more, if you're not used to it and it's best to avoid it because not everyone survives the trauma of being liquidated.

It's the most painful thing that you'll ever get with your trades if you just so don't know about it as a beginner.

Its not really that a good recommendation when it comes on not to use more that 2x leverage but we know that people are naturally greedy on which it isnt really shocking that their normal threshold
would be sitting around 10x or even 20x leverage on which we know that this one could really be pertain out to be gambling but since you are able to applying out some analysis then it wont really be
completely be that considered to be gambling on which it isnt really shocking that there would really be those people who would really be testing out this kind of option on which they do know
that once they do hit up the right prediction then expect profits to be something more comparing when you do make spot on having 1x-2x on which this has been the typical or in default.

Its not really that bad on taking up such advise on which i do see its relevance but well each person does have their own choice on which it would really be having that
kind of preference on how we would really be gonna handling ourselves.

Because the more you increase leverage, you have more chance of losing your funds taking high leverage is just like gambling so I don't take any trade in gambling using leverage I just hold assets and sell them after they hit my goals i do not even take any trade in spot beace trading is also a risky part for those who have less portfolio. Taking more trades is a bad habit well if you want to do trade put the only money you are willing to lose otherwise do not take trade Yes if trade goes in your favour it can make good money for you as well.

The higher the leverage the higher the risk and the chances of getting liquidated very quick , I think greediness and getting rich quickly prompted many newbies traders to opt for high leverage of more than 2x without taking into consideration  high volatility in the prices of cryptocurrencies, from personal experience I had once use a leverage of 10x when future trading a crypto pair on Binance exchange immediately the price reverses and went against my entry point I got liquidated in a very short period of time though I traded with small fund which I can afford to lose just to learn and have a feel of high leverage trading unfortunately it was a bad experience.

Everyone's principles are of course different, all trading certainly has its own risks, however, some people choose to take risks, both big and small, they are ready for everything, if you say that this is about guts, I really agree, there is no harm in trading using leverage, of course. with good trading skills

People have personalities and those personalities decides on all this, it doesn't really matter what you do. I think it's clear that we are going to see people do whatever they want to do and they will not be hearing it from anyone to do otherwise.

If you are the type of person who does spot trading then you will keep being a spot trader, if you are the type of person who does 100x leverage then whatever I tell you, or whoever tells you not to, you are going to not stop, maybe take it down another, like 50x or something or 20x but not going to be a spot trader or do 2x at all, that won't work. That is why it is quite important to make it work one way or another, it is not really something that I would suggest doing otherwise and don't expect any different.

Without doing it, we still can increase our potential profits. What's better is, we can do it in a less risky way. It is by increasing our knowledge on doing normal trades. If we want to, we can also use more money although this might start to increase our risks, but this is still better than doing leverage trades. No matter how wise we are, there is that one moment where we can lose.

So, guts is also needed here and it's better to use only amounts that we can afford to lose. Like I said earlier, there is still a risk in a normal trade, so how much more if the ones who are doing it are the newbies? They still lack in knowledge, so I won't say they can do it safely.

You can't generalize that. Leverages originally come from the trading of currency pairs (USD <-> EUR, ...). These hardly change during the day and were therefore absolutely uninteresting to trade for traditional small investors. Only with leverage was it possible for small investors to make - or lose - large profits with small stakes.
The trend towards leverage then gradually spread to other asset classes.

But I agree with you: leverage has no place in a highly volatile market like cryptos. You can get enough "action" in the market without x100. In my opinion, by the way, leverage has no place in the traditional equity market either.

I get that the "loan" mindset is true, you are loaning money, but having higher leverage is the biggest risk you could take. Assume that you invest 1000 dollars, but you do x100 leverage, that means it will act as if you have 100k, so when it goes to 99k, it is going to liquidated all your cash, because it went down a thousand and you only had a thousand, a 1% drop equals to you losing 100%, whereas a 1% increase also means 100% increase for you, because 100k became 101k and you earned that.

You are leveraging your money while also leveraging your risk as well. I would say it is a good move when you are on the right direction, but it is literally losing all of your money when you are on the wrong direction and you shouldn't take it.

Leverage is the most important part of future tradiing because this portion is only use to need while you have money needed in the type of loan.

Whenever you take a trading in future the less leverage will have less risk and more leverage have more risk so it's the leverage have important role in future trading.

I think it's a wrong advice, coming from him. It casts a shadow of fear on traders who trade using leverage. 2x isn't that high if one knew what one's doing, trading. It's very infinitesimal. Instead of trading on <2x while not completely go off it and do Spot trading. People don't become rich or make a sustainable earning from trading using that. Fear kills the morale of traders the same way greed does. Every traders should know how to kill both. For me, 5X till 10X is ok. Otherwise, the trader should stick to Spot trading.

I don't think that you will see the effectiveness of your trading skills by increasing the leverage to x100 and only staking $1 because the liquidity is too low. The liquidity will not be able to handle even the slightest down trade.

But the most important thing to remember is that if you will do an experiment like this, increasing the leverage and opening a trade, then make sure that the funds you have in the trading account are meant for that experimentation or that the funds will not affect your financial state even if they are gone. honestly, I sometimes do this kind of trading, increasing the leverage too much and just seeing what will happen, but no matter what the result, lose or win trade, it will not affect my other funds as I have a separate account for live trading. You should always take precautions to secure your funds.

Placing $1 just as an experiment to see how effective using x100 leverage is, this will be a great thing when the trade is successful.
There will be no psychological disturbance when only using $1, but beginners will have different thoughts, there will be a lot of bets used because they cannot manage and whether using large orders will be risky or not. whereas if the trade failed by x100, it would wipe out all their assets. So the use of leverage must be wise enough and must not be greedy or in accordance with the trader's abilities and knowledge.

Agreed Over leveraging is one of the quickest way one can lose his trading account ,It's much better to aims for gradual growth instead of blowing up the whole trading account . Its a very dangerous habit when it comes to trading .

It occurred to me that 2x leverage would be used by people who have a lot of money, and people who don't have money, even if they have a little money. The extra that is saved for trading is what leverage they are going to increase so that they can make more loss in a few seconds, so I think it's a risky thing, the more leverage you use.

It can give you both in loss and profit if you have more amount then leverage if you use less then you can effort if you have  less money and you are using  more than 2x leverage you may have a problem

maybe what is meant for long term trading, most average futures traders place leverage at 25+, because it usually only works temporarily, like me personally sometimes I increase the leverage to 125 x and only order $1-2 in each trade setting the SL and TP options for Minimizing risk, which Vitalik said is true if we trade for the long term, does not apply to the short term

You misunderstand the rules of trading with leverage. If you have a budget of $100, you do not need to open an order using your entire budget, otherwise what you have described will happen. With a budget of $ 100, you will need to open a position with a leverage of x10 for a maximum of $50, so that in case of loss of these funds, your balance will decrease by only 5%.

Trading with leverage will certainly increase your potential profits, but it should be perform wisely, otherwise you will lose all your funds in just a blink of an eye. Probably that’s why Vitalik made it as a financial advise because majority of the traders or investors still lose in the process, most particularly for those who take leverage.

However, if you are still beginning to learn the process, it would be much better to stay away using leverage, you can safely trade or invest without compromising its own risk.

The higher the leverage used, the riskier our trading will be, especially if we cannot control our psychology and end up trading using lots that do not match our calculations. especially if we experience a previous loss, then increase the lot with the aim of recovering quickly, this kind of thing can damage our trading mentality resulting in a psychological attack, which ultimately harms ourselves

We can increase when we have sufficient amount available. If the budget we have is low, How can we protect ourselves from liquidation? 

That trading should be done by those who have a sufficient amount of budget they can reduce or increase the leverage and can bear this loss from time to time to invest in it in order to save themselves from being liquidated and to save their entire budget from being liquiditation.

there's reason why these high leverages exist in the first place though its to give bigger opportunity for those that are brave enough to bet on their decision and I think thats fair, if anyone is losing big with future thats because they are reckless not knowing how to trade, these leverage are good and I personally have made quite good amount of money from these leverages.
its just that some random newbie trying to make it big using leverage that is over their capability and then go around venting is just really try to give bad reputation for this high leverage mechanism but overall i think there are many people that take advantage of this feature still.
imagine with $1 you can just 100x leverage since you are so sure that the coin is gonna be rising anyway and then you are investing as if you invested $100 but with only $1 i think thats fair enough.
but of course the risk is also higher but overall its fair game to be honest.

It depends on how much money you have in your account.
When there is 50k you can even do a 1k trade with 50x leverage. It is al about the margin and not the leverage!

It's risky for all volatile assets actually, not for cryptos only, penny stocks could also be dangerous. But it is what it is, it's not more risky than a bet at a casino or a bookie. With a good money management you shouldn't lose much funds. So saying it's very dangerous and you should never use it is a bit overkill IMO, if you're not a beginner you will take care to not engage too much funds in such trades in order to preserve your bankroll.

Its not subjective at all.

Your leverage is too high if you do not have enough margin to cover your risk, plus a head room to account for the liquidation mechanism, which trigger before your margin is at zero.
That,s it. There is no such thing as too low leverage or "just right".

Leverage is one of the most misunderstood concepts in trading. I could explain in more details about how you do prober risk management, I just feel no one here would really care, it is obvious that this thread is more about making post in signature campaigns that actually having a discussion about trading.

This is what I keep telling anyone who trades in futures. You really have to use leverage wisely and don't use high leverage. The aim is to get bigger profits, but the risk of loss is also bigger. In my opinion, using 2x leverage is enough. Sometimes those who are new to futures use higher leverage and end up being liquidated. Apart from that, management needs to be done correctly, without management trading will not go according to plan.

Hmm, still some people prefer high leverage for fast returns. TBH this greed sucks and I've encountered many people who gambled their money on high leverage and in the end as always lost all of them.


Hmm, Hype waves suck haha.. Again, natural trading and risk management always give a safe playing field. In the end of the day over-hyped and over-valued projects should not be considered as reliable for the trading not even on the short timeframe.

Dear instead of that I would say those who are beginner traders.. trading on leverage is a big risk to their funds besides that they should start trading in spot and can learn easily because it has less risk in losing funds although the risk is also included here.


well, haha I also noticed this big trap of TRB where the people who short it at the lower prices have to face big lose, and on the other hand people who long it at higher prices have to face big lose as well 

thats definitely what should people doing instead of always choosing future trade, spot is always the safest, if coin dump just wait it, if it increase just find right opportunity to dump. its as simple as that yet people are sticking with future trading maybe because they are used to it and maybe they want to take advantage of some small leverage which aren't gonna be giving profit but honestly even if its 2x leverage its already two time of our initial capitals so it does make sense though why people are still sticking with future trading because we can get double the profit but with double the risks.
personally i always stay with spot trading though since im already used to it also sometime we can follow some staking program when we are stuck with some loss.

50x and more leverage are definitely just trying to give away our money, yes the market can grow high but also remember that if the market just dipped a bit we lost our money, its as simple as that.

There is nothing wrong with leveraging but sometimes some persons do misuse the ability for them to leverage.
Leverage is a way for us to increase the amount of funds we are using to enter the market. Once we understand the brain behind leveraging, we are not going to have problem on the right way to leverage. Many have leverage ld and have made money from the market while others had ended up in loses.

In my opinion it is better to use low leverage in trading platform because with low leverage your risk of losing in trading is much less. Those who use 10x 25x 50x 75x  leverage have a higher risk of their assets. So I would always say it is better to use low leverage even if the trading platform has low profit. However, 2X can be used up to a maximum of 10X. Using more than this means increasing the risk of your assets on the trading platform.

Agree, totally non-sense if the size and risk is not being considered. If you this post by Vitalik, 'don't use greater than 2x leverage' if you got $30 in your account would you even dare to follow him?

I'm not sure how to calculate to know if your leverage is high, too high, too low, or just right enough. I guess this is pretty subjective for one to know.

Hmm, I guess yeah, that's just what it is. It is a tool we need to know how to use, and use wisely.

Yes, you are absolutely right, because the more leverage you give, the more chances of getting credit in your loan, the less leverage you have, the safe your money will be. The money will Safe from being liquidate,

So I will also prefer that the person who has most of the leverage should keep it low, then whatever we have, we will continue our trading with safety and our profit will be confirm instead of loss from liquidation

2x leverage is more risky but I used 20x leverage hoping for extra profit. It was a big wrong decision for me at the time because I lost a lot of money due to it several times. With such a high risk I would be satisfied with a small profit but when losses occurred I would remind myself how much I was risking my capital for a small profit. After losing huge amounts several times I learned that I shouldn't be trading futures with such high risk. When I didn't have the money to trade I figured spot trading would make a small profit if needed but I would never get involved in futures trading again. There may be temporary loss of money in spot trading but there is no possibility of total loss of money and since then I have given more importance to spot trading.

if you only use a small leverage it is better and better to trade in spot not in futures. if you really want to enjoy a little challenge in the future it is better to use margin trading which is not a big leverage. if you are looking for safety with a small leverage, it is even safer to trade in spot not in future trading.

Just spending funding fees only when trading in future with 2x leverage, usually minimum leverage I used in trading future under 10x and looks better to earn much profit than 2x leverage. I think if leverage around 2x better trade on spot and not required have to pay funding fee each 8 hours and depend with kinds of coins trading get pay more higher fees.
Indeed coins movement drastically up or down its depend on how careful our research and not problem with some coins suddenly up and down significant in short time just as TRB coins last several days. Price drastically up from $150 to $500 but in short time return back to lower price more drastically until $130.

I don’t do “IF,BUTS OR MAYBES, I DO ABSOLUTES” 20x or nothing

Before people use leverage in futures trading, they should understand that the risk of losing is greater. They must be able to accept this risk by adjusting it to the funds they use.

And whatever leverage they use, they must be aware of the risks. They don't need to use large leverage if they don't want anything bad to happen. You can continue as long as you are ready for whatever will happen with your futures trading. But if not, it's best not to use futures trading because the risk is greater than spot trading.

That is why if people do not have experience or ability in trading, they should not try futures trading. They can learn to use spot trading while learning more about trading, including analysis. If their skills have improved, they can use futures trading but must use the leverage they can afford.

high leverage exist for people that don't have high capital but want to get big profit, the risk involved is i think understandable, after all when we can get the opportunity to profit as if we are investing 10x of our capital thats definitely not happening without future trading, but then again as you said it will definitely have a risk, even more so with those people that i've seen frequently using 25x leverage is if it was nothing the slightest flash dump could definitely liquidate their money it just nuts.

but overall its a fair game if you know how to take advantage of it properly the thing with most of people is that they don't even have idea about the coin they are investing but still go with high leverage just in case they are proffiting big from it not knowing that the opposite scenario could definitely something thats gonna happen instead.

When one trades with high leverage the chances of liquidation are high because when you go to trade with a $100 budget and use 10x leverage it will trade an amount equal to $1000 and if the price of your chosen coin is up 10% or  Down and if it is against your entry you will lose your $100 and the trade will be cancelled.  There if you take 2x leverage then the price of that coin has to change by 50% for you to liquidate.  High leverage means more profit and more loss.  So it is better to use less leverage to be less risk

If it wasn't Vitalik, would you be discussing this?

He has a lot of money and also he forgets that each person has their own decision to determine which one is the best to choose. 10x leverage is dangerous, but some people like it because they think they will get more money if the market direction matches predictions. 2 years ago I became a person who likes playing with the futures market and high leverage.
I myself admit that I have lost and experienced liquidation in high leverage futures trading on Binance. But I am ready for the risks I will face. Regret is inevitable, but it is my decision, I must be able to make it a valuable lesson.

Right now I only focus on trading on the spot market, which means I only use 1x leverage. However, my action was not because Vitalik was giving advice, but was the result of my experience when experiencing losses on the futures market.

Can't that only happen if an asset experiences a drastic decline to just $0.00 which can cause the 1x leverage to be liquidated?

Leverage is one of the most misunderstood concepts within trading.

Leverage is not important, risk management is important.

It makes no sense to talk about leverage in a context where trade-risk in relation to your account size and position-size is not mentioned.
Once you have calculated those two parameters, then can you evaluate if your leverage is too high.

Leverage is just a tool, nothing more.

When it comes to advises and suggestions then it wont really be that bad that you would really be trying out to hear out on what others been saying specially into those known figures here on this space
then it not bad to take some advises but we know that people are really that having that curiosity and do really loves on experimenting things on which even if  they are aware on whats the risked involved
on which they would really be tending to make use of high leverage instead of less ones or those common suggested because it is really just that normal for people to have that kind of behavior on which
we do really love on seeing huge profits instead of small ones then we are really not that patient when it comes to trading on which there are ones who cant really just that wait
and would really be making use of those huge leverage on which we know that it isnt really that recommended.

There are really just those people do really love to throw up some bucks and there are ones who cant really just able to control their emotions and let their greed
do controls them and ended up miserable because of wrong decisions.

The reason he says this is because there is everyday when there is some liquidation event and you see tons and tons of people blowing up their accounts because they over leveraged.

I doubt anyone actually trades successfully Long term with any leverage greater than 10x. When people use 100x, especially on an alt coin then I wouldn’t be surprised if they didn’t get liquidated sometime in the first few hours. That and your fees are charged with the leverage and taken from your account which isn’t leveraged with fees so your liquidation is actually closer than 1% price moves.

I always said that we may go with any level of leverage but purely proportional to our risk-reward ratio, which means higher leverage is all that bad neither. Basically by 2x leverage, you are doubling your losses and income depending if you are right or not. I do not think that it would be easy to get liquidated if you do double when you have calculated position according to your available funds, you would probably get out a lot earlier and not really let it be like that. However, at the end of the day, we are talking about a situation that would be understandable, it is not a big deal so it wouldn't be too much of a risk.

I hope that 2x would gain traction too, not that 100x stuff, those are insane people who use it that much, that would mean that if you are wrong even for a slight second, all your money would be gone, that's insane. I agree with 2x, I would be fine with 5x but I wouldn't even approve 10x, even that is being commonly available in most exchanges these days.

He tweeted that if you use leverage, don't go with more than 2x leverage but his advice is much stronger, just don't. Don't use leverage is his ultimate advice which I agree with him on this.

Because leverage is very addictive and many times, we can become uncontrolled with it. We can initially limit our leverage taking at only 2x but if things change in the market and with our positions, we might break the plan and change to higher leverages. This will be changes to our nightmare.

No ways we can be sure that we won't break plan so if we can just don't use it initially, it will be better.

No matter what coin you trade, if you do not adhere to the rules of risk management, you will eventually lose your money, even if it is the lowest leverage. Despite the fact that this may be a banal advice that everyone knows about, but nevertheless few people use stop loss in practice, which is mandatory for margin trading.

Vitalik's saying keep it chill with less than 2x leverage is pretty wise. But, you know, it depends on the crypto because some like TRB can go wild even at 1x. Just gotta be smart about balancing risk and keeping your assets safe.

I agree with him and it tallies with my experience, when I open positions, I look at liquidation price I'm going to get, and right balance is usually found between 2-4x leverage. I have positions open with leverage in-between same numbers since long time. I tried going above that once (10x with LINK recently) I sensed liquidation price was too close, but I went ahead with it anyway cause FOMO of bull market it didn't turn out well.


I'm of the opinion that margin trading is not bad, it is a good tool reap huge profits in short amount of time in bullish market, even if you are low on capital.

Just don't use leverage will give you best.

Bitmex Advanced Margin Trading Guide 2020. Margin enthusiasts will feel more scary after reading the guide. I don't share the guide to hook newbies to margin trading because it is always risky to use leverage, even just 2x leverage like Vitalik advised, just don't.

The guide can help newbies to know why their leveraged positions get liquidated by exchanges and know more about the risk, to avoid leverage.

Because they can understand the formula of liquidation, make calculation and think with 2x leverage, price will not crash to liquidation price but if price falls a bit, one round of liquidation will trigger another and more rounds of liquidations, then eventually price will hit to liquidation price of their open position which in their calculation should be safe. In reality it is not safe in market crash.

I have not found information anywhere that Vitalik Buterin is engaged in trading, so I am skeptical of such advice. We know that there are different opinions on this issue, but we can only say for sure that if someone does not know how to trade, then he should not increase his losses using margin.

Well, the leverage thing advice of Vitalik Buterin for me is for sure only applies to him or that is what he is really using.
But for me, it really depends, depends on risk tolerance as other successful traders are using more than 2x leverage, it really depends.
For sure he also have some reason why is and that's how he really trade, where you can say it is less risk.

I guess there is one point of Vitalik's life that he did more than 2x leverage and he lost and he's done with it. It's a good advise for someone who's conservative in investing but in trading, traders should also consider what he's said.

If someone is going to follow his advise, that's good and it helped what he said. But if not, no matter who's saying these advises, we're on our own as we trade.

Good thing with Vitalik is that, he's got his own platform through his social media and I am sure that many newbies that admires him follows him a lot.

Vitalik Buterin's advice to avoid using more than 2x leverage in trading is ABSOLUTELY wise.


It helps US to manage risk in the highly volatile cryptocurrency market....

It's crucial to distinguish between traders and investors, with traders using lower leverage for safety....

Asset security in noncustodial wallets is essential. Leverage suitability depends on an asset's volatility, and high leverage can lead to liquidation, as seen with TRB's price drop. Responsible trading involves assessing risk tolerance and market conditions while prioritizing asset security and control...

I think it should depend on the accuracy of the trader in that particular trading position or trade. What the source said is true: don't use 2x the leverage as it will also raise the risk and the amount to be lost if, for instance, if you are not sure about your trade, then don't do it really because it will only burn your trading account. Leverage is a very dangerous thing to manipulate when trading.

So if you are a trader who is sure about the position you will open and confident enough to risk it, then you can raise the leverage for a greater reward or profit, but this is not applicable for those who go short. Yes,  they might earn depending on the volatility of the market, but they can't maximise the potential profit, so it's better to go long when trading bitcoin. There are a lot of things to be learned in crypto trading, and manipulating risk and leverage is one of them.

Trading “futures” with higher capital without “Leverage”?

How is this possible? or, you probably meant trading spot?
I can't imagine any scenario where one can trade futures contracts minus applying leverage. Even if it's 1x, there is still leverage involved and the position will also have a liquidation price.

Totally agreed .Its very risky for any traders to over leverage when opening positions will be much better to accumulate small profits than go for a huge one and get liquidated easily ,I have lost so much over-leveraging during my days as a new trader  with time i have since learnt my lessons and refrain from such bad trading habits.

Actually he is just saying the truth, if you enter a long position in Bitcoin with 100usdt with 2x leverage, it's near impossible for you to get your account liquidated.
If you buy long from 42000 dollars, Bitcoin will have to fall up to five thousand dollars for you to get liquidated, so he is actually right about it.
Me I even prefer to trade futures with higher capital without leverage than do anything leverage trading, in such senario, your duty is to wait for Bitcoin to rise to your desired amount, then cash out big time.

This is part of a list if I'm not mistaken, and based on my understanding this is all tips he gave to people who are looking to invest in the crypto space as newbies. Despite that however I don't think what he's saying couldn't be true for us pros, as even us fall short sometimes especially when it comes to our price predictions and positions.

2x leverage to me is nothing more than a gamble that's stacked against you. moreso if you're an investor since what you're only ever expected to do as one is hold your coins and reap the profits eventually. Having to go so far and greedy to take a 2x leverage is a massive bullet in the head that could literally kill your momentum as a trader and eat all your investments away. Traders can still pretty much survive this as you have said since most of them know what their risks capacities are but I seriously advise against it as well on the account that it kinda is harder for traders to recuperate their momentum and assets especially if you have 2x leverage on all your positions. But who knows? Honestly it all boils down to how much risk you can take as a trader and less about the 2x leverage itself. Personally I think it's a massive risk that you shouldn't take even if the profits look appealing, my opinion could differ to everyone.

I am referring to Vitalik Buterin, one of the ethereum founders post on Twitter that states that people should not use more than 2x leverage.

Don't use >2x leverage. Just don't.

It is one of the things he listed as a financial advice. As a trader, what do you think about it? We set some money aside for trading and as for me I still use up to 2.5x leverage for bitcoin to open a long position.

I think using this low leverage is good for traders. But investors should not use leverage at all. Investors should even supposed not to leave coins on exchanges but moved the coins to a noncustodial wallet.

This is also not applicable to many coins that are very volatile in a way that 1x leverage can even lead to liquidation of asset. See what happened to TRB recently that fall from almost $700 to $125.