🔵 Why and When to Use Leverage?: Using 5x leverage vs 50x leverage essentially means that you are being lent 5x or 50x your money, respectively.

🟢 The Problem with High Leverage: The issue with high leverage is that if you trade with a position larger than your total funds, you have a liquidation point. But if you don’t, you can be pretty relaxed that you are not going to be liquidated.

🔴 Trading Example: Let’s say you open a position with a $1 margin, 50x leverage, so your whole position is $50 and your margin is $1. If the crypto you chose has made a 1% increase since you opened the position, that means you will have made a 50% return on your margin, or $0.50. If the crypto has made a 10% increase, you have made a 500% return effectively on your margin or $5 on your $1 margin.