In this article you will learn how to trade bitcoin with leverage on the best margin platforms in 2021.
Bitcoin leverage trading has become very popular in recent days with more and more exchanges starting to offer their customers to trade with margin.
When done right, bitcoin leverage can be used to increase profits up to x125.
All though it can be very profitable, keep in mind the risks behind this style of trading.
High bitcoin leverage is what’s interesting today and traders all around the globe are looking for the best platforms to increase their daily gains.
No matter if you are a beginner trader or a seasoned pro, today you will either learn something new about margin trading or find your new favorite platform to trade bitcoin.
Below is a list of the best margin trading platforms for bitcoin leverage.
If you are new and want to learn how to trade bitcoin with leverage, there will be a step by step guide below this list with an example.
Best Bitcoin Leverage Trading Platforms Compared
|Exchange||Leverage||Payment Method||Trading Fee||Info|
✓ $80 Welcome Bonus
✓ Lowest Trading Fees!
✓ Recommended Exchange!
✓ Bitcoin CFD-Trading
✓ Advanced trading interface
✓ 125x Bitcoin Leverage!
✓ Easy to use
✓ Accepts VISA Cards
✓ No KYC-documents needed
How to trade Bitcoin with Leverage – Step by step
When it comes to the actual process of opening a bitcoin position with leverage, it’s not that difficult.
It’s a standard position with some extra money attatched to it.
All you really need to be able to leverage bitcoin is a platform that supports margin trading and you are good to go.
For those who are new to bitcoin leverage trading, here comes a step by step explanation on how to get started with an actual exchange example.
There are three simple steps to get started:
- Create an account.
- Deposit money.
- Open a leveraged position.
Below follows a simple but detailed explanation featuring trading platform Skilling one exactly how to open a bitcoin leverage position.
Step one is to visit the exchange and create an account.
Once you have signed up, navigate to the top left corner and click the hamburger menu icon.
This will open the menu where you will be able to select Trading.
Next up is to choose Bitcoin.
Once you have chosen Trading you will see the different trading pairs and from here you simply click Bitcoin.
When you click Bitcoin, a new trading interface will show up to the right and you will be able to see the bitcoin chart.
Next step is to open the position.
Now it’s time to open a leveraged bitcoin position on Skilling and it’s very straight forward.
There are two ways to open a position.
You either click the Trade button inside the trading interface, or you click the bid/ask price to the left.
Here is screenshot of both examples.
Lastly you will choose your position size.
Once you have clicked either of these buttons you will see this order selection window.
When you trade bitcoin with leverage on skilling you will be able to choose market order and also your stop loss and take profit levels.
The first highlighted area is your position size.
Choose the amount, choose your stop loss, take profit, and then you click Buy.
That’s how bitcoin leverage trading is done on Skilling.
Now it’s up to you to catch the market.
Remember that you can short with leverage on Skilling as well which might be a very good strategy if you are sure that the market is going to fall.
Bitcoin Leverage Trading in the USA
When it comes to trade bitcoin with leverage from the USA it’s not all that easy.
Many platforms are not accepting traders from the US and therefore you might have some trouble finding the right platform that will allow you to trade with margin.
Some of the platforms in the list above will not accept US traders due to regulations.
However, there are some exchanges that does, such as:
These are pure cryptocurrency exchanges that allow you to deposit with many different cryptocurrencies.
Or, if you feel like you can buy bitcoin with credit card on some of these exchanges and then start trading with leverage.
Some of these exchanges will let US traders trade bitcoin with up to 100x leverage which might be interested if you have enough experience.
None knows when the market for USA will open up to more exchanges, especially those located outside of the US.
Until then, try the platforms mentioned above.
Bitcoin leverage trading in the USA is not impossible, but it’s a little bit more difficult, this article should give you some new insight into where to trade.
Can you trade Bitcoin with leverage?
Yes, today there are a lot of platforms and online exchanges that offer btc leverage trading.
They do offer very high leverage as well with up to 125x on Binance for example.
Since cryptocurrencies ballooned in 2017, many new trading platforms have developed their leverage and margin trading.
This article will feature some of the most reputable and most trusted trading platforms for bitcoin leverage trading.
Unless you are willing to risk your money in some shady exchange off-shore, these are for sure the best options on the market in 2021.
Before you start to trade you need to consider some things such as, trading fee, security, level of leverage, and of course the charting interface.
The exchanges I’ve listed all have outstanding interfaces and they are all competing for the lowest bitcoin fees on the market.
Skilling, Plus500, and AxiTrader are three CFD-brokers where you can trade bitcoin with leverage.
The other platforms are pure cryptocurrency exchange where crypto transactions are welcome.
This means that you can transfer your bitcoin from Coinbase for example to use them with leverage.
This can be very profitable if you are sure the market will increase or fall.
So take your time and analyze which platform will suit you best.
When you have found the right broker you can start trading bitcoin with leverage.
What is Bitcoin leverage trading?
The concept of trading any cryptocurrency with leverage might be a little bit difficult to understand.
I will try to explain it to the best of my abilities.
Bitcoin leverage trading is a way for you to trade with more money than you currently have access to.
That’s the simplest way to explain it.
What it really means is that when you trade with margin, your cryptocurrency broker will lend you money on top of what you already have.
They do this to let you take bigger positions sizes in the market.
This is a double edges sword where you stand to make insane gains in a very short time, or you might lose half of your account in a few minutes if you are not careful.
The upside for you is that if you are a good bitcoin trader, leverage will increase your gains.
The upside for the broker is that you will pay extra fees, because with the increased position size you also pay higher fees.
The best explanation is to say that you will get access to more capital than you currently have to trade bigger position sizes.
The extra money comes from your broker that will supply it from special liquidty institutions.
Companies with very deep pockets support the bitcoin exchange, and they support you.
That’s the whole system in a very broken down format.
Don’t worry however, you will not lose the money you are borrowing.
If you are unlucky enough to have your bitcoin leverage account liquidated your position will be closed out and your account equity will get reset to 0.
That is the best explaination to what bitcoin leverage trading is.
Where can I trade Bitcoin with leverage?
You can trade bitcoin with margin or leverage on many different exchanges, both CFD-brokers and pure cryptocurrency exchanges.
This article has featured some of the best picks of 2021.
This is the list of best bitcoin leverage trading platforms:
- Prime XBT
The first three trading platforms, Skilling, Plus500, and AxiTrader are CFD-brokers.
The rest are pure cryptocurrency exchanges.
You need to know the difference between a crypto CFD-broker platform and a crypto exchange.
Crypto CFD-brokers does not sell you the actual coin, or the digital asset.
Here you are only able to speculate on the pricemovement.
However, when you use a crypto exchange, you are able to buy the actual underlying coin, such as bitcoin or ethereum.
The advantage of trading bitcoin with leverage on a CFD-broker is its trading interface and order selection.
You will get to trade with a proffessional charting packages that comes with real stop loss orders and take profit orders.
They alsio have more deposit options where you can pay with fiat currency to trade bitcoin.
Most of the CFD-brokers that offer btc margin trading are also regulated which does not make it more safe to trade but it adds to the legitimacy of the broker.
So, take your time to go through the list of brokers to find your favorite and then start trading, good luck.
How is leverage used in Cryptocurrency?
Leverage, or margin, is used to increase position sizes when you trade cryptocurrencies.
Many platforms will let you choose the level of margin on your own ranging from 2x up to 125x on some exchanges.
The actual process of using leverage when you trade crypto is not difficult at all.
Everything is automated by the exchange and the only thing you need to do is to select your margin and then choose your position size.
Next, open your position and keep track of your profit or loss.
It’s important to understand that using margin when you trade cryptocurrency will increase your profits as well as increase your losses.
The thing most traders are interested in is of course to maximize profits.
However, this can be difficult if you are not experienced enough.
When you use leverage to trade cryptocurrencies, your risk-limit is reduced significantly.
Only by using 2x margin will put your potential stop loss at 50% drawdown.
This means that if you open a position the market can’t fall more than 50% or you will get liquidated.
If you use 3x margin, your biggest risk-limit is at a 33% stop loss which gives you even less wiggle room when the market starts moving.
It’s safe to say that using more than 5x leverage when you trade cryptocurrencies will reduce your risk-profile a lot and you are forced to use a stop loss order.
Also remember that if you use margin your fee will increase accordingly.
The fee or commission you pay when trading is a % of the position size.
So, if you trade 1000$ with 10x leverage the broker will calculate your new fee based on the new position size which is 1000$ x10 = 10,000$.
This is something that most new traders miss out on and therefore they spend a lot of money on fees while trying to make it work.
Keep this in mind and use it to your advantage and only trade with margin when you have spotted a good setup.
Lastly, leverage is used in cryptocurrency trading to make up for what ever capital you might not have.
Let’s say that you have an account of 1000$ and this is not enough to make a living out of trading.
If you are a successful trader you will be able to increase profits by using extra leverage to supply your account.
How does leverage trading work?
It works by having a cryptocurreny broker that will offer you to trade a margin funded account.
The broker has very deep pockets and they are willing to lend you money and let you trade on their platform.
Everything is done automatically and the only thing you neeed to do is to pick a crypto broker and create an account.
From the time that you enter the trade interface and select your position size and leverage, the broker will adjust everything accordingly.
When you have selected your level of margin, the exchange will supply it to your account instantly.
The margin that is offered will give you the possibility to increase your position size.
This works by adding extra capital on top of your current account balance.
It’s pretty simple in theory and you should not try and complicate it more than this.
Just think that leverage works as a way for you to be able to trade with more capital than you currently have.
What is 100x leverage?
Here is a very simple explanation to 100x leverage.
Let’s say that you have a 1000$ trading account.
When you trade this account, your maximum position size will be 1000$.
Pretty simple right.
If you use 100x leverage when you trade this account your new maximum position size will be 100,000$.
The simple math behind this is 1000$ x100 = 100,000$.
What are the risks?
So, there are 3 major risks involved to leverage or margin trading bitcoin.
This will be different for all traders depending on how you trade.
But only by beeing aware of them will make you a better traders.
Risk number 1
This is the obvious one but it’s always good to mention.
Bigger position sizes will lose more money, faster.
When you start out with bitcoin leverage trading you will for sure play with the leverage and try to maximize the gains.
Most traders use 100x leverage the first week just because they think they will make a lot more gains.
This is not true at all for a couple of reasons.
If you are not used to trade these position sizes you will not be able to handle the market movements and your stop losses will be hit very frequently.
Since you lose your own money, the new position size will eay up your account very fast if you trade with too much margin.
Risk number 2
Not only does big positions make a bigger hole in your trading account when you lose, they will also make you lose more often.
The difficult thing with high margin is to time the market.
The major reason traders lose money while trading with leverage is the death of a thousand losses.
What happens when you use a lot of leverage is that your stop loss has to be very tight and this causes the market swings to stop you out, over and over again.
This doesn’t seem to be such a big problem in the beginning, what’s wrong about losing a small stake in a stop loss?
The real problem is that you will almost never be right on timing when you use very high levels of margin.
So what happens is that you can get stopped out 25 trades in a row without hitting any winners just because your stop loss is too tight for the current market conditions.
This causes you to spend a lot of capital on fees and many stop losses.
To battle this problem, try to cut the margin and trade smaller.
Start with half of your current leverage and then see how it goes.
Risk number 3
This is a given but most traders still fall for this everything when they start out.
It’s the greed of trying to make a lot of money in a very short time.
If this was possible, no bitcoin exchanges would ever allow traders to trade as they do.
The reason why this is almost impossible for most traders starting out is due to the bitcoin market fluctuations.
The market will not give you money that easy.
That’s the true story and it will not get easier by trying harder.
Before you can make real money with bitcoin leverage trading you need to practice for a long time and then you increase the margin.
It will feel very tempting in the beginning to use a lot of leverage but the sooner you understand that it’s a dead end to always maximize the better it is.
My recommendation if you have hit this wall is to cut your leverage 10 times and really step back to basics.
Focus on what the market is doing and how it is behaving before you decide you margin.
Then once you are in tune with the market you can start trading with more confidence.
If you are new to the world of margin or leverage you will need some assistance in the beginning to make it through the first hurdles.
This is to make things easier and also to understand what you might be doing wrong and what you can think about to change your approach.
Below follows my top 3 bitcoin leverage trading tips.
Do not start out with maximum leverage.
You have no idea how it feels to trade position sizes 100x bigger than you ususally trade so the road there is difficult and it takes some getting used to.
Start out with 2-5x margin and see how that feels.
Only bump up the leverage if you manage to make money for a week or two.
Go from here to around 7-10x to not make the change to big for you.
It is all in your head and it takes some time to get used to bigger position sizes because the losses will also increase.
Enter positions when the market is small.
The way this helps is you will be able to when the volatility is lower and this will cause less stress on you.
It will also let you tighten up the stop loss just a little bit which is always nice.
Also, entering the market when the volatility is low will make sure that you are not entering an emotional impulse trade.
Since the market is more calm you will be able to focus more on your thought out setup and enter only when your entry signal is met.
The last tip I would like to share is to not over trade.
It’s so easy to over trade with leverage and this will cause your fees and stop losses to add up.
One very good way of avoiding over trading is to put a maximum amount of trades per day and per weak.
For example, 10 trades per day will stop you from goin down the nasty rabbit hole of trying too hard.
Also if you experience that it’s difficult to stop your-self from over trading you should probably cut your position size and increase your stop loss.
This will feel a little bit boring in the beginning but it will be well worth your money once you learn how to trade.
You will have bigger winners if you hold on to your positions and you will get less stressed by all the stop losses eatin your account.
My own experience
My first year of leverage trading was horrible.
I didn’t have any idea of how to make thins work out and why I was losing money.
After a while I realized that I was taking way to many trades per day, and per week.
I was paying my brokers too much commission which started to eat from my account so I had to create another system.
I started by doing one important thing.
I cut my position size by 10 times!
Yes, that’s right.
I cut my position size 10 times, which basically means that I used 10x less leverage.
At first, this was very boring because the wins were not as big as before and I really wanted to go back to the crazy trading I had done before.
But I know if I did that I would fall back into the same trap.
I gave this new system a 3 month trial.
The first month was very boring and slow because I didn’t make as much as before when I won.
The second month I realized that it was easier to hold on to my winners and I started to make more on the few winners I had.
I was taking fewer trades but I was making more money on each winner and the losers got very small.
The third month I was making more money than before from all my winners I held on to with a positive trailing stop loss.
This has been my system now for years and I would recommend any struggelin trader to try it out.
Trading is all about finding your nisch so if you are stuck with bad performance, change something and give a coupe of months.
This article is a helpful guide for all new traders starting out with bitcoin leverage trading.
If you are an experienced trader you might find a couple of new platforms you want to check out.
The main goal is to inform and educate any trader reading up how to trade bitcoin with margin.
You will learn where and how to start trading and also some very important tips to get started.
I will also share some of the biggest risks and a little bit of my own experience.
Yes, it’s absolutely possible with todays cryptocurrency platforms and they are constantly upgrading and imporoving their infrastructure.
The most simple and best answer to this is to say that leverage in crypto trading i a way for you as a trader to be able to trade with more capital than you currently have.
Some of the most popular platforms are: