Leverage trading means trading a larger position than your own capital would allow. With a $1,000 stake and ten times leverage, you move bitcoin worth $10,000: if the price rises 5 percent, you make $500 instead of $50. If it falls 9.5 percent, the exchange closes your position and the stake is gone. In Germany, leverage trading with cryptocurrencies is allowed but capped for retail clients: crypto CFDs may carry at most 2:1 leverage, while the perpetual futures of exchanges with EU authorization go up to ten times. This guide shows how to calculate margin, profit and liquidation price, and where you can trade with a licensed provider.
Leverage trading at a glance: the key numbers
- Leverage of 10 means $1,000 of collateral moves a $10,000 position.
- At ten times leverage, a counter-move of about 9.5 percent is enough for liquidation; at one hundred times, 0.5 percent.
- Since August 1, 2018, crypto CFDs in the EU have been capped at 2:1 leverage for retail clients.
- Since August 2017, retail clients in Germany can never lose more than their account balance on CFDs.
- A long position in the bitcoin perpetual on OKX paid about 1.5 percent of its value in funding ...
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