The 500x leverage trade that turned $2,500 into $200,000 is undeniably impressive, but it’s also a case study in the power and peril of leverage. Here’s a deeper dive into how this kind of trading works, why it succeeded, and the risks others should consider:



How 500x Leverage Works


• Amplifying Gains:


• With 500x leverage, every 0.2% increase in XRP’s price equates to a 100% gain on the trader’s initial capital.


• This means that small price moves can lead to massive profits—but also devastating losses.


• Margin for Error:


• The trade margin was razor-thin. At 500x leverage, a price drop of just 0.2% from the entry price of $2.00 would result in complete liquidation.


• This extreme sensitivity underscores why high-leverage trading is akin to walking a financial tightrope.

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