Topic: Margin trading in crypto good or bad? (Read 4448 times)

This question concerns many people in cryptocurrency today, I still think that for me margin trading is a great opportunity, so I always vote for margin trading, because it is an opportunity that should not be missed.

You have also seen in the cryptocurrencies market that it is difficult to use technical analysis in predicting price trends. So the margin trading is the same as you gamble, the odds are 50/50.

Margin trading in crypto is too risky and most traders will be margin called because there is huge prices volatility. I don't recommend use margin more than 5x leverage but DYOR!

We can't say good or bad but it's risky as hell like gambling.
If you are not ready to lose your money, please don't step in.
Exercise on testnet of bitmex first

Margin trading has a high risk level and may not be suitable for all investors. You can sustain a loss of some or all of your initial investment and therefore you should not invest money that you can not afford to lose.

I can't advice crypto traders to use margin trading because the market is already volatile and as a business minded person, you should be mindful of probability of negativity or loss.

in alts  price move with a good % at lest 10 to 50% in all cases so no need for leverage to make profit.
but if price move down 1 to 5 % down if you are in leverage position,  it is a big lose.

Certainly Margin trading is more profitable but the  high level of profits associated to high risk as well.in my opinion you don't need to margin trading because the crypto market have  enough high volatility for profits.

The market is young and volatile and I do not know if it is a good idea to start using margin trading. It contains a lot of risks but can give you an amazing profit, if you can analyse the market. If you want to risk and gain big profits, that margin trading is for you.

if you find an exchange in which you trust that it does not do maintenance in the less indicated moments the margin trading can be an additional tool in the help of traders to avoid any losses

leverage does not make the asset more or less volatile, it is just an financial instrument, it is your choice to use it or not.
Also i am not sure that there is asset behind leverage trading or is it just a representation tied to assets value.

I think margin trading has both there merit and demerits but if you ask me I will not go for it because it has more demerits then merits ... It's just like gambling where the change is more to loss your all investment.

This is bad for me. Of course, there are advantages for a trader with a small capital. However, the risks associated with margin trading are much higher: if the price of a cryptoactive asset seriously goes down when trading to increase, then when it reaches a certain critical point, a trader may lose his entire deposit due to margin. -call - forced broker to close the transaction when a certain drawdown is reached on it, if the trader has not added additional funds to the account. If borrowed funds are threatened, the exchange has the right to deduct the loss from the margin account deposit.

I think margin trading borrowed money will not be interesting. There is a very high risk of not earning so much that it is enough for both ourselves and the crypto exchange. After all, from my earnings crypto exchange takes on the contract an average of 15%.

I have a completely positive attitude towards working with an exchange that has margin trading, because such opportunities, unfortunately, can bring you a lot of money, but just as quickly you can lose your deposit.

that is right. The margin trading is too risky.

I wouldn't margin trade unless I was 100% sure that I was going to win the trade.
So unless you have some insider trading going on then I wouldn't recommend margin trading or trading with any type of leverage.

OHHH THANK YOU SOO MUCH!!!!!

I love it when a 1 post account trys to link me to an investment opportunity!

You are the Man, will I become rich now?

hi Guys
I have found a system which looks trustworthy, inwhich you can increase your deposits to 200%.
A certain risk always exists therefore I advise you  to invest only money which you can absorp.
For myself, i have successfully tested it, maybe it is something for you.
If you are interrested so look here :

https://cryp.trade/agent/qq871pntntbk

best regards,

Exso 

ofcourse marginal trading is a best way for trading if you have limit of money ( altcoins at exchange )  .
since many persons consider it as lone and lending like things but actually it is a way to make our trade successful with small recruitment .

Stop order is the most important in the margin trading. Without it, you might lose everything during the trading.

yes because for those who already manage this system they are taking advantage knowing how to make the entry and the exit point makes them more profitable there's no problem with the system it was build to help if you understand and if you take some time to understand maybe those who losing money doesn't read and understand much.

first, it's not simple put a stop order, you need to know where to put it... supports and resistances are basic in technical analysis.
people dont know how to trade, how the system works, they lose money and they blame the system... simple as that.

margin trade isnt bad and doesnt need inside informatition... if you lost money it was your mistake, dont blame the system.

Gambling is gambling in any form, you just need to understand how to hedge your bets. Most people will lose because they do not understand the rules. Knowing that all Crypto markets are manipulated is the #1 thing you must know, if you don't understand and accept that then you are already a loser.

If not, you only lost that initial deposit and the site eats the margin they gave you.  I would never do this and there are IP issues and too many factors to work around, but that is the risk they are taking.

You have to be smart and professional to do the margin trading. If not done properly, you will lose everything.

This is important to watch

yeah it's bad, you know what happen if you can not pay back right? they can sue you, you can't just run away and open a new account lol, i don't like leverage because of this

In my opinion it is bad using margin trading in all of cryptos coins not altcoins only, except you have found the ways how to making profit constantly from trading. Because if we don't find it and using margin trading, we will not be focus on trading, in our mind there is just debt only.

Open an account, deposit say 1 BTC and start margin trading at one the highest margin percents they allow for you.  You come out on top, awesome.

It would be illegal, hard to deal with site security and basically wrong, but it could be done because of the anonymity factor. 

The first thing that I did every time I started playing was start the game and put the initial bank the game starts you with on the longest bet on the floor, a 50-1 bet on a wheel.  If I won, great, I started playing with 50 times the initial set.  If I lose, I turned the game off and back on and did it again until I won.  Margin trading crypto can use the same concept.

My rule is to have 60% to cover and not to leave it unattended the markets move to fast and only use it on a high volume coin. But it is risky and is definitely gambling.

margin trading altcoin is bad
because is pump and dump is not control
not control under line bottom price, under line high price
you can lost all money is fast time is margin trading altcoin

i also thinks the same about the crypto and also all altcoin trading margin is good for better profit.
since it is an art to get profit but needs mind job .

It's just similar to margin trading in traditional stock markets. Nothing too bad about it. It just provides liquidity of the markets.

Bittrex apparently has a very basic trade bot that can do this.  I would never tell someone to use a bot for trading, but you can use their bot to set an auto sell at low and high limits.  This is a nice way to be able to sleep at night without worrying that the new coin went from 5000 Sat to 1 overnight.

AS far as i know margin is something that would exit your position if its on the bear trend, not much different to the stop loss. But i would rather want both out of the crypto trading for what would its use be if someone wants to hold a coin for as long as he wants.

In my Opinion is it much better if we don't use margin trading because for me margins are too bad in crpto currenies  and also it is bad on the stocks We can't earn that easily on margins unless you already had knowledge on what you are going to do if you really want to earn more profit then make some way.

Stop-loss? Hell, most exchanges are set up in such a way that this is pretty easy without special interfaces.  After the initial buy, some exchanges let you set up a sell trade with a bottom limit, meaning that the trade only fires at the price or below, rather than simply dumping your new assets at a scary low price and sitting slack jawed after it happens.  

What?helping for increasing the volume of the coin? margin just helping the trader have seen about the condition a of coin and becoming a place for trade their coin and no including for increasing the volumes in my mind.

Margin trading for coins can help increase their volume and liquidity which can be very good.

There are a lot of terms being tossed around, lol.  What the OP linked to is a pretty standard model of margin trading, or trading against an amount that is not actually owned by the trader.  This is actually a pretty crazy thing to do with crypto, for the site, not the trader.  When I was young I had a Nintendo and a casino game, I think “Caesars Palace”, now bear with me, this relates. 

well, then they should call it something different, lol.  i think in stocks that is something like equity trading, lol.  I was peeking more at it too, it looks like other users are covering the margins in some cases, as loans

Margin trading using any type of funds is BAD BAD BAD.  Why trade with money you don't have??  Leverage is BAD BAD BAD.  Just don't do it.  Trust me, I have experience and here's how my experience went.

Hit it big margin trading, but greed makes you want to leverage more..and in the end, lost it all and MORE!  Cuz that first time you did so well, kinda makes you want to keep chasing it.

it's not how it works there... you need a collateral to do margin... you cant lose what you dont have because your margin will be ended by the system after you lose 80% of your colateral. it isnt credit.

OMG, I am on Polo all the time and have even looked at the margin trading without the obvious kicking in.  Who covers these margins on anonymous accounts?  Setting up multiple accounts is illegal if used to defraud, but there are those that do not care.  And I can picture a new person losing big and against a margin and simply not being able to ever fix it.  I really gotta look at this more, lol.  Margins on my FIAT stock sites are based on factors.  I assume that they do a credit check during the first few days after sign up and know exactly what margin they are giving a person.  But that is not possible on Polo.  I guess everyone gets the same margins or maybe aged accounts get more.  

I just never thought past simply seeing the options, lol.  Imagine my friend asking to borrow ten bucks, ok I know him, no problem.  But when "account number 0052266" appears wanting a loan, lol, wow, amazing.

The stop loss is very important in the margin trading. If you do not exit when the loss builds up, you will lose a lot.

you dont know what you're talking about...

a trader who doesnt know what is a stop loss isnt a trader... dont mistake gamblers with traders (doesnt matter if you are in stocks/forex/commodities/crypto, if you dont know how it works, you're gambling).

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@topic
margin is ok, but you need to learn a few basic things before you start or you will end up losing everything.

I dont understand how margin trading work. Could someone tell me how it work? Or you can give me an article about margin trading?

Margin trading is a double edged sword. You can profit if you get the trade going as you expected it to. If not, then you're in neck deep trouble. IMO, it's better not to use margin trading unless you really know what you're doing and don't let greed get the best out of you. You'll end up paying a higher price if you can't control your greed.

Trading on leverage/margin is good if you win but bad if you loose. Dependant on your appetite for risk.

@Jjtjjt. I could have not said it any better myself. Margin trading is good if you know what you are doing. It is the opposite if you don't. So it would be better to stay away from it if you love your money so much. Trading cryptocoins is like betting in a casino. You will lose many times and using margin will compound this.

Invest what you can afford to lose, i.e 500 bucks, and try to turn it into 50k.  Don't take 50k turn it into 500.  Margin trading isn't bad.  When people tell me it is I don't listen to what they're saying, I listen to why they are saying it.  Life is a soccer game with defenders.  If you listened to someone everytime they tell you it can't be done you'll never make any $.

Yep a whale that also know your exact Margin Trading details and can move the market whenever they like to grab your collateral.
I am sure they are glad that does not bother you.

Say, saw your Mom's was a Pole Dancer (according to your Post)
Wasn't in Georgia late 80s to mid 90s was it and how old are you again?

So I know if I need to say:


 


FYI:
Whew Never Mind, No Worries, Just Remembered I had my Shields Up.

Got my butt handed to me on margin trading. So it's a no go for me.

I don't use them for longs, but shorts is a different story.

Worshiping at the Altar of Stop Loss Orders also has issues like below.
It is still a rigged game, in favor of the exchanges.
Worst thing is people like the guy below explain why you should not use them at all, which places the original danger right back in play.
http://www.swing-trade-stocks.com/stop-loss-orders.html

FYI:
Unless you are Hillary Clinton with insider info, expect to Lose:
http://community.seattletimes.nwsource.com/archive/?date=19940330&slug=1902853

Yes, Kiklo, you can lose a bazillioin dollars if you have no idea how to use a stop loss order.  That's why people that have no idea what they're doing shouldn't use margin.   Traders like it for a few reasons.  It allows you to use the asset itself as your core position instead of fiat for collateral, which most people say is a bad idea, but if you believe it's going to increase in value while your fiat isn't, hey, why not.  It allows you to make money when volatility is low as well.  It also gives you more margin of error to dollar cost average trades that don't go your way.

You could technically call this "throwing good money after bad", but it usually works.  I was doing some small trades in BTC earlier just scalping a few bucks.  I had one trade not go my way and put me down a few dollars.  So what do I do?  Just make my position bigger while being near the right side of the market.  Now my bigger trade on the right side has canceled out my smaller trade on the bad side and I basically break even even though my original pick wasn't correct.

Margin in altcoins is ridiculous though.  There's not enough liquidity, so people on the buy side receive no benefit from being able to place larger orders, while on the sell side, it just makes it too easy to implode markets where nobody will want to go near them.

Margin trading in anything is a tool of exchanges to rid you of your money. They can see how much you got and can force the price to go just enough to close your positions and pocket your capital. Don't do it.

Or more Likely an Exchange DUMP.  


 

Volatility comes from the buying & selling , and that is what truly drives a market.
And when you buy or sell your coins, you are limited to that amount gained or loss.
Where as People dumb enough to Margin Trade without having insider information , can lose Many Times the amount they put up for collateral.

Mess up trading the normal way , you only lost the coins or amount invested.
Mess up with Margin Trading and Lose Everything you Own.
Your Choice.

 

FYI:
At least be informed:
http://www.marketwatch.com/story/help-my-short-position-got-crushed-and-now-i-owe-e-trade-10644556-2015-11-19

FYI2:
https://bitsharestalk.org/index.php?topic=17141.0

cant deny margin trading causes higher volatility, higher volatility definitely hinders use as normal currency , so I think my point is valid 

Margin Trading won't make any difference whether Crypto succeeds or not.
It is only a way for Exchanges to steal money from the stupid.

Part of the reason for crypto is to leave our Debt Based Fiat System behind, not create a Debt based Crypto system.

 

https://poloniex.com/support/aboutMarginTrading/

 

Is it good for crypto? Because it increases volatility and I think we all want crypto to successful right?

I still don't understand how margin trading works.  shorts?  longs?

Could someone explain all this to me like I'm five?  Every time I've asked, the descriptions were filled with words that I didn't understand/wasn't able to put in context due to lack of knowledge.  I have accounts on all major exchanges, so an example through, say, poloniex's system would be ideal.  Been trading for a while with good returns, but have never been bothered to do enough research on margin trading, how it works, etc.

Thanks in advance

Hmm,
Where did you see any mention of removing Freedom of Choice?


 

Margin Trading is bad in Crypto and bad in Stocks.
You can't be a winner at Margin trading unless you have inside information , which makes it insider trading and illegal in the US.
When you Margin Trade and it goes the other way you can end up owning many times more than the Value of what you Borrowed.
That is how people lose their Homes and everything they own.


http://beginnersinvest.about.com/cs/newinvestors/a/040101a.htm

 

Yes??

Its not a yes or no answer!

Yes.

I think margin trading is certainly bad for alt currency. crypto currency is volatile even without leverage, with the added option of leverage it makes the swing even more dramatic which makes it usability as a currency even more difficult.

when ever there is a Bitcoin or ether reversal some exchanges conveniently shut down for maintainence or the currency in question mysteriously vanishes from exchanges.