What is the maximum leverage of Bithumb delivery contract

Traders can take advantage of leverage offered by Bithumb's delivery contract, ranging from 20x for XRP to 100x for BTC, to potentially multiply both profits and losses.

Nov 21, 2024 at 02:57 am

What is the Maximum Leverage of Bithumb Delivery Contract?

Introduction

Bithumb is a South Korean cryptocurrency exchange that offers a variety of trading services, including spot trading, futures trading, and options trading. Bithumb's delivery contract is a type of futures contract that allows traders to speculate on the future price of a cryptocurrency. Traders can use leverage to increase their potential profits, but it is important to understand the risks involved before using leverage.

Maximum Leverage

The maximum leverage available for Bithumb delivery contracts varies depending on the underlying cryptocurrency. The following table shows the maximum leverage available for each cryptocurrency:

Risks of Using Leverage

Leverage can amplify both profits and losses. If the price of the underlying cryptocurrency moves in the trader's favor, they can make a profit that is multiplied by the amount of leverage they are using. However, if the price moves against the trader, they can lose more money than they originally invested.

It is important to understand the risks involved before using leverage. Traders should only use leverage if they are comfortable with the potential for losses.

How to Use Leverage

To use leverage, traders must first open an account with Bithumb. Once they have an account, they can deposit funds into their account and start trading.

To trade a delivery contract, traders must select the underlying cryptocurrency, the contract size, and the leverage they want to use. The contract size is the amount of the underlying cryptocurrency that the trader is buying or selling. The leverage is the amount by which the trader's profits or losses will be multiplied.

Once the trader has selected the contract size and leverage, they can place an order to buy or sell the contract. The order will be executed at the current market price.

Example

Suppose a trader wants to buy a Bitcoin delivery contract with a contract size of 1 BTC and a leverage of 10x. This means that the trader is buying 1 BTC worth of Bitcoin, and their profits or losses will be multiplied by 10.

If the price of Bitcoin rises by 10%, the trader will make a profit of 10%. However, if the price of Bitcoin falls by 10%, the trader will lose 10%.

Conclusion

Leverage can be a powerful tool for traders, but it is important to understand the risks involved before using it. Traders should only use leverage if they are comfortable with the potential for losses.