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By Alexander Reed
Last Updated: Mar 26, 2025
Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
99Bitcoins may receive advertising commissions for visits to a suggested operator through our affiliate links, at no added cost to you. All our recommendations follow a thorough review process.
Crypto is a high-risk asset class. This article is provided for informational purposes and does not constitute investment advice. You could lose all of your capital.
99Bitcoins may receive advertising commissions for visits to a suggested operator through our affiliate links, at no added cost to you. All our recommendations follow a thorough review process.
The potential to double or triple one’s holdings is often just a mere trade away, especially when margin trading. This post explains what Bitcoin trading is in a nutshell and what is Bitcoin margin trading.
Margin trading, also known as leveraged trading, is a form of trading that uses borrowed funds in order to trade larger amounts of a specific asset. For example, if you have 1 Bitcoin on Binance, you can borrow up to 2 Bitcoins more and trade as if you had 3 Bitcoins.
While margin trading increases your profits when successful, it also accelerates your losses when unsuccessful.
That’s Bitcoin margin trading in a nutshell. For a more detailed post, keep on reading. Here’s what I’ll cover:
Bitcoin trading is the act of buying low and selling high. Unlike investing, which means holding Bitcoin for the long run, trading deals with trying to predict price movements by studying the industry as a whole and price graphs in particular.
Here’s a crash course in the basic terms of trading:
One extremely profitable yet risky trading strategy is margin trading, also known as leveraged trading. This simply means that traders borrow capital at relatively high-interest rates to increase their leverage.
If things go right, huge gains can be expected. On the other hand, the wrong move could end up breaking traders as they battle high-interest rates, margin calls, and order liquidation (both explained below).
Some exchanges offer 1:1 leverage, meaning that traders can borrow 100% of their holdings. For instance, a trader with a balance of 1 BTC will effectively be able to trade 2 BTC, increasing profit potential.
Other exchanges offer 2.5:1, 3.3:1, 20:1, and even 100:1 margins. With 100:1 margin trading, I can find myself either up 500% in minutes or liquidated in the blink of an eye. It’s more like playing the slot machines at the casino, so I don’t necessarily recommend it.
When things go right, it’s obvious that traders have the potential to earn a significant sum of money by leveraging capital through margin trading.
Traders who understand risk management should be able to avoid losing their entire bankrolls in a few trades. Such traders have the potential to earn way more money by leveraging capital than they could by using their personal funds only.
However, margin trading doesn’t come cheap, as borrowed funds are subject to high-interest rates. These charges are automatically withdrawn the moment a position is closed out. In addition, trades that don’t go as planned often end up liquidated, resulting in a total loss.
If a margin trade goes in the wrong direction, individuals will be required to add funds to their accounts in order to avoid order liquidation. This is known as a margin call. If a trader is unable to provide further funds to secure an order, it will be closed out automatically.
If a margin trade loses more money than the trader has on hand, the trade will be liquidated. This means the position will automatically close, and the trader loses all of his money. Chances of liquidation increase dramatically when margin trading. Let’s explain with an example:
Let’s assume you have only $100, and you buy $10,000 worth of Bitcoin (with a 100x leverage). If Bitcoin’s price drops by $1, you effectively lose $100 because of how much you’re leveraged. In this case, you don’t have any more money in your account, and your trade will be liquidated.
As you can see, leveraged trading goes both ways – increased profits but also liquidation happens on much smaller price movements.
PrimeXBT offers up to 200x leverage on Bitcoin. The platform’s negative balance protection safeguards you from owing more than you invest, and there are educational resources to help beginners understand leveraged trading.
You can read my complete PrimeXBT review here.
MEXC offers Bitcoin margin trading through both USDT-M (forward) and Coin-M (inverse) perpetual futures. You can access up to 200x leverage on USDT-M contracts and 125x on Coin-M. MEXC also provides detailed fee structures (taker/maker fees and funding rates).
You can read my complete MEXC review here.
Margex provides up to 100x leverage on Bitcoin and other top cryptos, backed by liquidity from over 12 providers. The platform’s user-friendly interface, combined with advanced features like copy trading and multi-chart tools, makes it suitable for both beginners and pros.
You can read my complete Margex review here.
Next on the list is BloFin, which offers Bitcoin margin trading with leverage up to 150x. It has two main modes—isolated margin and cross margin. You can opt for an isolated margin to cap potential losses to a single position or cross margin if you prefer using your entire account balance as collateral.
You can read my complete BloFin review here.
CEX.IO offers 10:1 margin trading through CEX Broker. The site allows you to trade Bitcoin and Ethereum CFDs. CEX Broker also supplies demo accounts for those who want to gain some theoretical experience before putting down real hard cash.
You can read my complete CEX review here.
Bitfinex offers 3.3:1 margin trading. Simply put, traders can borrow $7 for every $3 they have in their accounts. Since Bitfinex is the biggest Bitcoin exchange in the world by volume, traders should start there.
You can read my complete Bitfinex review here.
Investors who want to throw all caution to the wind and attempt to maximize their profits may want to margin trade at 100:1 leverage on Bitmex.
When things go right, it’s like a rocket ship launching to the moon—yet one small move in the opposite direction will entirely liquidate an order. A word of caution: start by trading small amounts.
You can read my complete BitMEX review here.
Binance allows 1:3 margin trading for Bitcoin, Ethereum, XRP, Binance Coin, Tron, and Tether. Users can also lend cryptocurrencies on Binance for interest in order to fund margin activities by other traders.
You can read my complete Binance review here.
Margin trading is a risky business. Beginners should start out trading small amounts at a margin of no more than 2:1. Ideally, never use 100% of funds in any one transaction.
For instance, placing $1,000 into an account and using only $100 of personal capital with 2x leverage per transaction would still leave a trader with $900 if their margin trade didn’t work out.
In general, margin trading is suitable for experienced traders. If you’re just starting out, it’s better to use demo accounts or trade without any leverage before taking it up a notch.
Established in 2013, 99Bitcoin’s team members have been crypto experts since Bitcoin’s Early days.
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Having delved into futures trading in the past, my intrigue in financial, economic, and political affairs eventually led me to a striking realization: the current debt-based fiat system is fundamentally flawed. This revelation prompted me to explore alternative avenues, including… Read More
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