[Is higher leverage riskier?] 📈📉
What we commonly refer to as 100x, 50x leverage basically refers to opening a position leverage. Many people think that using 50x leverage is very risky, which is a common misconception in the crypto world 🔥.
Assuming your account has 2000u 💰.
If you use 20u margin and open 100x leverage, your position will be 2000u. This is equivalent to 1x position, and if you go long 📈, you will never be liquidated unless the coin goes to zero 📉.
If you use 200u margin and open 20x leverage, your position will be 4000u, which is equivalent to 2x leverage. You will only be liquidated if the fluctuation exceeds 50%.
Therefore, the risk control multiplier does not matter; it mainly depends on your position 💰.
Currently, the price of Bitcoin is 62000. If you open one Bitcoin with 10x leverage, you need a margin of 6200u. If you use 100x leverage, you only need a margin of 620u. Although the leverage used is different, the final profit situation is the same because the positions are the same.
Your final profit does not depend on what leverage you use, but on how large your position actually is.
So when you look at profit reports, if someone directly shows their return rate, their position is usually not large. They might not want to share a profit of a few dozen or few hundred u, so they just post a return rate. With a small position and high leverage, a reported return rate of 300% or 500% seems very high, but the actual profit might only be a few dozen u.