How to use 20x leverage on Crypto.com

Leverage trading on Crypto.com allows users to potentially amplify profits, but carries inherent risks, including liquidations, margin calls, and increased volatility.

Nov 24, 2024 at 01:58 am

How to Use 20x Leverage on Crypto.com

Utilizing leverage in cryptocurrency trading involves borrowing funds to amplify your trading positions and potentially increase profits. Crypto.com offers leverage trading, allowing users to trade with up to 20x leverage. However, it's important to understand the potential risks and rewards before engaging in leveraged trading.

Step 1: Understand the Risks of Leveraged Trading

• Liquidations: Failure to manage risk effectively can lead to liquidations, where your trading positions are closed automatically to cover losses.
• Margin Calls: When your account equity falls below a certain threshold, you may receive a margin call, requiring you to deposit additional funds or reduce your trading positions.
• Volatility and Risk: Leverage amplifies both potential profits and losses. Be aware that market volatility can significantly impact your trading outcomes.

Step 2: Eligibility and Verification

• To access leverage trading on Crypto.com, you must pass the exchange's KYC verification process.
• Complete the two-factor authentication (2FA) setup for added security.
• Verify your identity by providing required documents and undergoing a selfie verification.

Step 3: Opening a Leverage Trading Account

• Click on "Accounts" from the main menu and select "Leverage."
• Choose a trading pair (e.g., BTC/USDT) and select "Create Leverage Account."
• Fund the account with sufficient funds to cover potential losses. Note that a minimum balance is required to open a leveraged trading account.

Step 4: Configuring Leverage

• Access the leverage account dashboard and select the "Settings" tab.
• Under "Leverage Setting," adjust the leverage multiplier from 1x to 20x.
• Be cautious when choosing high leverage multipliers, as they can amplify both potential gains and losses.

Step 5: Placing a Leveraged Trade

• Navigate to the trading view of the chosen trading pair.
• Select the "Leverage" tab on the trading interface.
• Enter the order details (order type, quantity, and price) while considering the leverage multiplier applied to your account.

Step 6: Monitor and Manage Your Position

• Regularly monitor your open leveraged positions to ensure you're within acceptable risk parameters.
• Keep tabs on the market volatility and adjust your positions as needed to minimize the risk of liquidations.
• Use stop-loss and take-profit orders to limit potential losses and secure profits.

Step 7: Closing a Leveraged Position

• To close a leveraged position, simply place a corresponding order (e.g., sell to close a long position).
• The profit or loss made on the closed position will be reflected in your leverage account balance.
• Withdraw funds from the leverage account back to your main account as desired.

Step 8: Additional Considerations

• Leverage trading can lead to significant losses if not managed properly. Practice caution and avoid using leverage beyond your risk tolerance and financial capabilities.
• Monitor market conditions closely and consider the impact of news events and external factors on your trading strategies.
• Consider employing risk management techniques such as hedging, diversification, and position sizing to mitigate potential losses.