Bitfinex Will Roll Out x100 Margin Trading
Bitfinex will roll out x100 margin trading for Bitcoin. In the whitepaper on Leo, Bitfinex’s own crypto currency, under the heading “Upcoming projects” there was already a hint that from June 2019 trading would be supported with a leverage of up to 1:100 for “selected customers”. Now Bitfinex’s CTO Paolo Ardoino has added to Twitter, the offer is obviously ready for launch.
So far, Bitfinex has limited itself to levers of up to 1:3.3. To the estimate: Who trades for instance Bitcoin (BTC) with lever 1:100, must shoot already with price movement of 1 per cent in the unexpected direction immediately capital or loses its employment.
What Does Bitfinex Expect From Extreme Margin Trading?
Bitfinex wants to execute its new margin trading program via derivatives based on the tether (USDT). This stable coin is already closely linked to Bitfinex and could thus receive additional attention and liquidity. The cryptocurrencies to which the giant leverage may be applied are not yet known. In BitMEX’s competition, a leverage of 1:100 is only applicable to Bitcoin (BTC). Bitfinex should initially benefit from free PR for its margin trading and, in practice, of course, also from fees. Who is allowed to participate at all is unclear. Bitfinex speaks of an “individual risk level” that will be identified.
Is Margin Trading at Bitfinex Interesting For Me?
Studies show that the majority of private small investors in margin trading also make losses on traditional stock exchanges. Binance, which recently introduced margin trading with maximum leverage of 1:2, also reported the first liquidation of such a transaction this week, the moment when investors experienced a total loss. When trading on margin one should be sure he totally understands the risk and give it a try with a small amount first.