ELI5 - Leveraging Your Position on $BTC

Imagine you have $100 and you want to buy Bitcoin. If you buy Bitcoin directly with that $100, you can only get $100 worth of Bitcoin.

But, if you leverage your position, it's like borrowing some extra money to buy more Bitcoin than you could with just your $100. So, let's say you use 2x leverage. It means you're borrowing an additional $100 to add to your $100, giving you a total of $200 to buy Bitcoin.

If the price of Bitcoin goes up, you make a profit based on the $200 you invested, not just the original $100. But, if the price goes down, you could lose more than just your initial $100 because you have to pay back the borrowed money too.

So, leveraging your position is like using a magnifying glass on your investment. It can increase your potential gains, but it also increases your potential losses. It's like riding a faster roller coaster: you feel the ups and downs more intensely.