When you use crypto leverage, a trading method that lets you borrow funds to increase your position size. Also known as margin trading, it lets you control more crypto than your balance allows—but at a steep cost if the market moves against you. This isn’t magic. It’s math. And math doesn’t care how confident you feel.
Most people hear about crypto leverage and think, "More profit!" But the truth? Over 80% of new traders who use leverage lose money within months. Why? Because leverage doesn’t just multiply your gains—it multiplies your losses too. A 10% drop in price with 5x leverage means you lose 50% of your stake. With 10x? You’re wiped out. That’s not speculation—it’s a fact backed by exchange data from platforms like Binance and Bybit. And it’s not just about big moves. Even small price swings, like the kind you see on meme coins or low-liquidity tokens, can trigger automatic liquidations. Margin trading, the system behind crypto leverage, requires you to keep enough collateral in your account. If your position drops below a certain level, the exchange sells your assets to cover the loan—no warning, no second chance.
Some try to use leverage in DeFi leverage, lending protocols that allow borrowing against crypto holdings on decentralized platforms. But these aren’t safer. They’re more complex. You’re dealing with smart contracts, variable interest rates, and liquidity pools that can dry up overnight. Look at what happened with projects like Moola Market or KyberSwap Classic—low liquidity means your leverage position can collapse even if the market hasn’t crashed. And if you’re chasing airdrops like ONUS or RUNE.GAME while leveraged? You’re gambling twice: on the token’s value and on the timing of a reward that may never come.
There’s a reason why exchanges like Upbit and TradeOgre got slammed for not enforcing proper risk controls. Regulators aren’t just after money—they’re trying to stop people from losing everything. Canada seized $40 million from TradeOgre not because it was shady, but because it let users trade without safeguards. That’s the same danger you face when you turn on 10x leverage without understanding liquidation thresholds. Even if you’re not on a sketchy exchange, the risk is built into the system.
You don’t need leverage to make money in crypto. Many of the most successful traders avoid it entirely. They wait. They study. They let time work for them. The posts below show real cases: how people got burned by fake exchanges like LongBit, how airdrops like HGT and CovidToken are scams designed to steal your attention (and your keys), and how even solid protocols like Celo or Sonic can’t protect you if you’re over-leveraged. This isn’t about getting rich quick. It’s about staying in the game long enough to actually win.
Margin trading in crypto can multiply profits but also wipe out your account. Learn how leverage works, why most traders lose, and how to trade safely without getting liquidated.