Margin at Cryptoexchanges
A margin is required to be able to leverage a trade.
Margin Trading: You are allowed to use coins from peer-to-peer margin funding providers.
This means, that you can borrow buying/selling power, but you need to allocate some funds (=margin) which won’t be accessible until you return the lent coins.
Let us make a 10:1 leverage example. Let the Bitcoin price be $500.
Let us assume that you only have 500 USD but you want to buy 10 BTC. This is possible, but you will have to pay an interest for borrowing $5000 after you close your position. For example, the BTC closes at $550.
So you have made $500 or a 100% earnings for only a 10% price increase. From this earnings, you will only need to subtract the interest rate (about 2%) and you have your final profit/loss, which is higher if you predicted the course of the trade correctly.
Never forget, that if in the same example the Bitcoin price would have fallen to below $450, then the crypto exchange would have liquidated your position and your account value would be zero.
It is also possible to employ margin trading with a vast number of brokers that offer CFD trading on the Bitcoin and other cryptocurrencies.
$100 A Day Trading On Bybit - Cryptocurrency Leverage Trading For Beginners
According to InsideBitcoin’s crypto trading guide found here, it is possible to go both long and short as well as access the leverage of 20:1 with such brokers as eToro.
Next to this, the platform is available for both EU and US traders and provides a platform full of useful features, the main one being the Copy Trading.