Zornitsa Stefanova
Zornitsa Stefanova is a Financial Research and Platform Testing Analyst at BestBrokers.com, specialising in hands-on reviews of forex, cryptocurrency and stock trading platforms. She evaluates brokerage companies from a user-focused perspective, testing key areas such as account setup, trading conditions, platform usability, available markets and overall reliability.
| Expert Editor 
Matthew Levy, CFA
Matthew Levy, CFA, is a Senior Research Analyst at BestBrokers.com with experience in financial services, securities analysis, portfolio management, and trading. His work supports the broker testing process through detailed research, clear financial analysis, and a strong understanding of what traders and investors expect from reliable online trading platforms. 
| Updated: When it comes to maximizing potential returns from crypto trading, high-leverage platforms can be one option. Whether traders are looking for brokers or exchanges for high-leverage crypto trading, the brands listed below generally meet the needs of new and experienced market participants. Read on to learn more about the best brokers and exchanges in the crypto market, along with additional insights into crypto trading with high leverage.
Fusion Markets74-89% of retail's CFD accounts lose money
BlackBull MarketsTrading leveraged products is risky
Pepperstone73.7% of retail investor accounts lose money
Eightcap59.57% of retail investor accounts lose money when trading CFDs with this provider.
Plus500 USThis content applies only to Plus500 US and clients from the United States. Trading futures involves the risk of loss.
eToro52% of retail investor accounts lose moneyBest Brokers for High Leverage Crypto Trading
Operating since 2017, Fusion Markets is a suitable online trading destination for both new and experienced traders. During our hands-on testing, we evaluated the broker’s crypto trading portfolio, which includes 13 instruments involving some of the most sought-after cryptocurrencies traded against the US dollar. We confirmed that crypto CFD trading carries no commissions, while traders can go long or short and benefit from both rising and falling prices.
Through our live account monitoring, we verified that the average spreads for Bitcoin and Ethereum stood at 0.03% and 0.17%, respectively. To place crypto CFD trades, we could choose between the popular MT4, MT5, TradingView, and cTrader platforms. For our live execution and fee-tracking tests, our team used the MT5 integration.
Traders can take leveraged positions to increase their market exposure. Our research team checked the maximum allowable leverage at Fusion Markets, which depends on several factors, including the trader’s country of residence, retail or professional client status, and tradable asset type. We found that Fusion Pro Accounts and clients under the FSA and VFSC entities can access leverage of up to 1:10 for crypto. Retail traders under the ASIC entity, on the other hand, are limited to 1:2 leverage for crypto.
Gleneagle Asset Management Limited (ABN 29 103 162 278) trading as Fusion Markets, is the issuer of the Fusion Markets Products described in this communication. Trading in Fusion Markets Products involves the potential for profit as well as the risk of loss which may vastly exceed the amount of your initial deposit and is not suitable for all investors. You should read all of these Financial Product Service Terms, the Product Disclosure Statement (PDS) and the Financial Services Guide (available on our website) carefully, consider your own financial situation, needs and objectives for investing in these Fusion Markets Products and obtain independent financial advice.- 2. FP Markets
FP Markets is another top platform supporting crypto CFD trading without requiring a crypto wallet. Through our real-time platform analysis, we reviewed the brand’s digital asset markets, where Bitcoin, Bitcoin Cash, Cardano, Litecoin, and Ethereum are tradable against the US dollar. With 12 widely traded cryptocurrencies available, traders can diversify their portfolios and access a 24/7 market.
The broker supports popular platforms, including MT4, MT5, WebTrader, TradingView, and cTrader, all equipped with useful tools and features. The minimum deposit for credit cards, debit cards, and e-wallets is $50, while bank transfers require at least $100. For our live execution and fee-tracking tests, we opened a live account and used MT5. Our live logs showed Bitcoin and Ethereum spreads of 0.03% and 0.04%, respectively, with zero commission.
We also verified the maximum crypto leverage limits across the broker’s corporate entities. Retail clients under the CySEC and ASIC entities can trade cryptocurrencies with 1:2 leverage, competitive spreads, and zero commission. Professional traders can access maximum leverage of 1:5. The FSCA- and FSA-regulated entities, along with the entity registered in St. Vincent and the Grenadines, allow crypto leverage of up to 1:50.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73.33% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. BlackBull Markets operates under the authorization of regulators in New Zealand and Seychelles, providing a measure of oversight and client protection. In mid-2024, the broker announced that LMAX Group had acquired a minority stake in the company, with the partnership expected to expand and improve its crypto offering. During our platform evaluations, we confirmed that BlackBull supports more than 25 coins for CFD trading.
Cryptocurrency traders can place leveraged orders via cTrader, MT5, MT4, and TradingView. Our team used the MT5 integration to monitor performance and found that spreads are floating, as BlackBull Markets uses an ECN pricing model. Traders can view live spreads under the Crypto section in the broker’s instruments list. Through our tracking, we recorded stable average spreads of 0.02% for BTC/USD and 0.13% for ETH/USD.
Our regulatory audit confirmed that, under its Financial Services Authority (FSA) entity in Seychelles, clients can access maximum leverage of 1:100 for select markets such as BTC/USD and ETH/USD. Maximum leverage is market-specific, with some digital coins offering higher ratios than others. Leverage for XRP, ADA, and Dogecoin is capped at 1:50, while Solana/USD positions are restricted to 1:10. Contract size also varies by instrument, with BTC/USD volumes ranging from 0.01 to 5 lots.
Trading foreign exchange on margin carries a high level of risk and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange, you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and, therefore, you should not invest money you cannot afford to lose. You should make yourself aware of all the risks associated with foreign exchange trading and seek advice from an independent financial advisor if you have any questions or concerns as to how a loss would affect your lifestyle.- 4. ActivTrades
ActivTrades is a broker with more than 20 years of experience, offering clients a wide selection of tradable instruments to suit different trading preferences. Cryptocurrencies are available to most ActivTrades clients, except those registered with the FCA- and BACEN-regulated entities. During our platform evaluations, we confirmed that the broker offers 15 crypto CFDs, available on MT4, MT5, and ActivTrader.
Bitcoin, Ethereum, Cardano, and XRP are among the crypto assets traders can access as CFDs with ActivTrades. To evaluate order execution and costs, our team used the MetaTrader 5 platform during live testing. Through our live tracking, we documented competitive average spreads of 0.09% for BTC/USD and 0.24% for ETH/USD.
Traders who want greater market exposure can trade crypto pairs such as BTC/USD, ETH/USD, and others with leverage of up to 1:20. Our research team checked the maximum leverage ratio across each regulated entity. Leverage for certain crypto pairs, including BCH/USD and DOGE/USD, is capped at 1:10. These ratios are available to crypto traders registered with the Bahamas- and Mauritius-regulated entities. EU crypto traders can also access leverage of up to 1:20 on crypto CFDs if they qualify as professional clients.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 72% of retail investor accounts lose money when trading CFDs with this provider.You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. - 5. easyMarkets
EasyMarkets has served traders since 2001, focusing on advanced products, trading tools, and services. The broker complies with CySEC’s regulatory requirements and also holds licenses from regulators in Australia, Mauritius, Seychelles, and South Africa. Negative balance protection is available to all customers, while guaranteed stop-loss with no slippage is provided to easyMarkets Web/App and TradingView account holders.
The brokerage charges no account maintenance fees or commissions across its supported account types. EasyMarkets’ portfolio includes 18 crypto instruments, with maximum leverage of 1:2 for retail clients under the CySEC- and ASIC-regulated entities. Crypto leverage is capped at 1:100 for BTC/USD and 1:50 for altcoins under the FSC Mauritius, FSA Seychelles, and FSCM South Africa entities.
Through our live tracking, we documented that crypto spreads vary by regulatory entity, account type, and platform. Under the global FSA Seychelles entity, fixed BTC/USD spreads start from 0.03% on easyMarkets Web/App and TradingView. Floating BTC/USD spreads start from 0.04% on MT4 Standard and MT5 Standard accounts and from 0.02% on MT4 VIP and MT5 VIP accounts. ETH/USD spreads stand at 0.34% on easyMarkets Web/App and TradingView, 0.28% on MT4 Standard, 0.30% on MT5 Standard, and 0.16% on MT4 VIP and MT5 VIP.
The minimum contract size varies by instrument: 0.01 for BTC, 0.1 for ETH, and 0.5 for LTC. Customers can also use dealCancellation and Freeze Rate to manage risk more effectively.
Trade Responsibly: CFDs and Options are complex instruments and come with a high risk of losing money rapidly due to leverage. 71% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs and Options work and whether you can afford to take the high risk of losing your money. Please refer to our full Risk Disclaimer. Easy Forex Trading Ltd (CySEC – License Number 079/07). - 6. XTB
XTB entered the online trading scene more than 20 years ago and has expanded its customer base to over 2.5 million traders across various jurisdictions. The company’s multiple entities comply with the requirements of several strict financial regulators, including the FCA, CySEC, and KNF. Through our multi-entity compliance checks, we confirmed that the broker supports more than 40 crypto CFDs, including Bitcoin, Ethereum, and Dogecoin. Customers can rely on tight spreads, as well as safe and prompt deposits and withdrawals.
To evaluate order execution quality, our team used the desktop version of XTB’s proprietary xStation 5 platform. It is suitable for both new and experienced traders, providing live performance statistics and a broad range of trading tools. Based on our active platform evaluations, we documented that BTC/USD and ETH/USD spreads, for example, start from 0.10% of the market price. Trading LTC/USD comes with minimum spreads of 0.25% of the market price.
We verified that the crypto leverage cap for clients under the CySEC entity is 1:2, requiring a 50% margin for the BTC/USD pair. This is in line with ESMA’s crypto leverage limit of 1:2, designed to protect retail traders from high volatility risk. XTB International Limited, operating under the Financial Services Commission of Belize (FSC), allows maximum leverage of 1:10, requiring a 10% margin for Bitcoin.
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 73% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Comprehensive Comparison of the Top 6 High Leverage Crypto Trading Platforms
| Broker | Account Minimum | Regulators | Spread | Other Fees | Leverage | Instruments | Cryptocurrencies | Account Types | Negative Balance Protection | Our Score |
|---|---|---|---|---|---|---|---|---|---|---|
| 1. Fusion Markets | $0 | ASIC, FSA (Seychelles), VFSC (Vanuatu) |
|
| 1:2 (ASIC), 1:10 (FSA, VFSC) | CFDs | 13+ | Zero, Classic, Islamic, Demo, Professional | Yes | 4.38 ⭐ |
| 2. FP Markets | $100 | ASIC, CySEC, FSA (Seychelles), FSCA, FSA (St. Vincent and the Grenadines), SCB (Bahamas), FSC (Mauritius) |
|
| Up to 1:2 (retail clients); up to 1:5 (professional clients) | CFDs | 12 | Standard, Raw, Demo, Professional, Islamic | Yes (retail clients) | 4.37 ⭐ |
| 3. Global Prime | $0 | ASIC (No. 385620), VFSC (No. 40256) |
| $7 round-turn commission on Raw accounts; 0.1% trading fee | Up to 1:2 (ASIC); up to 1:5 (Pro and VFSC) | CFDs | 40 | Standard, Raw, Demo, Professional | Yes (ASIC retail traders) | 4.08 ⭐ |
| 4. IC Markets | $200 | FSA (Seychelles), CySEC (Cyprus), ASIC (Australia), SCB (Bahamas), CMA (Kenya) |
|
| Up to 1:2 (Retail); up to 1:5 (Pro) | CFDs | 23 | Raw Spread cTrader, Raw Spread MT, Standard MT | Yes (European and Australian retail traders) | 4 ⭐ |
| 5. easyMarkets | $25 for Web/App Standard Accounts | CySEC (license no. 079/07), ASIC (license no. 246566), FSA (license no. SD056), FSCA (54018), and FSC (license no. SIBA/L/20/1135) | BTC/USD - 85 | No account maintenance fees | 1:2 | CFDs | 20 | easyMarkets Web/App, TradingView, MT4 VIP, MT4 Premium, MT4 Standard, MT5 | Offered as a standard feature on easyMarkets accounts. | 3.90 ⭐ |
| 6. XTB | $0 | FCA (License No. FRN 522157), CySEC (License No. 169/12), FSC (License No. 000302/438), IFSC (License No. 000302/35), KNF (N/A), CNMV (N/A), BaFin (registered), FSCA (N/A), FSA Norway (Registration ID: FT00118162), DFSA (License No. F006316), CMF (Chile) | BTC/USD target spreads start from 0.22% of the market price | No deposit fees; no withdrawal fees for transactions over €100 | 1:2 | CFDs | Bitcoin, Binance Coin, Bitcoin Cash, Cardano, Dogecoin, Ethereum, Litecoin, Ripple, Solana, Tron, and more | Standard, Pro, and Islamic accounts | Available for UK, EU, and MENA retail customers under XTB Ltd and XTB MENA Ltd | 3.80 ⭐ |
Best Exchanges for High Leverage Crypto Trading
| Exchange | Tradable Coins | Maker/Taker Fees | Interest Rates | Wallet Service | Staking | Max Leverage | Min Order | Payment Methods | Regulators | Trust Pilot Rating |
|---|---|---|---|---|---|---|---|---|---|---|
| 1. Bybit | 2,350+ |
| BTC Est. APR - 0.05% | Yes (Self-Custody) | Yes | 1:200 | USDC Perpetual Contracts and USDC Futures Contracts min order size - 0.001 BTC | Debit/Credit Cards, SWIFT Transfer, Bank Transfer, PIX, SEPA, Zen.com, iDEAL, BLIK | SCA (UAE), CySEC (Cyprus), AFSA (Kazakhstan) | 3.4 ⭐ |
| 2. OKX | 350+ |
| Yes (Non-Custodial) | Yes | 1:100 for futures; 1:10 for spots | Spot/margin BTC/USDT - Min trade amount 0.00001 BTC | Debit Cards, Credit Cards, Mobile Wallets, SEPA, iDeal, Pix, Bank Transfer, Crypto, Bancontact, PayNow | FSA (Seychelles), VARA (Dubai), MFSA (Malta) | 2.0 ⭐ | |
| 3. MEXC | 2,500+ |
| BTC - Up to 1.80% | Yes | Yes, up to 600% APR | 1:200 | 0.00001 BTC | Bank transfers, bank cards, Skrill, Apple Pay, crypto | Registered in Seychelles, FUI Estonia | 1.8 ⭐ |
| 4. Kraken | 560+ | Spots: from 0.25% / 0.40% to 0.00%/0.05% (depends on tier); Margin: 0.02% opening fee; Futures: from 0.0200% / 0.0500% to - 0.0060%/0.0125% (depends on tier) | 0.02% on every 4 hours | Yes (Self-Custody) | Yes | 1:50 | $1 | Visa, Mastercard, PayPal, Wire Transfer, Etana Custody, Apple Pay, Google Pay, Crypto, iDeal | FinCEN (US), FINTRAC (Canada), FCA (UK), FSRA (Abu Dhabi), AUSTRAC (Australia), CBI (Ireland), DNB (the Netherlands), BoS (Spain), OAM (Italy), CBB (Bahrain), VARA (Dubai), BAPPEBTI (Indonesia), SEC (Thailand), SAT (Mexico), CNAD (El Salvador), Registered FSP in South Africa | 1.7 ⭐ |
| 5. KuCoin | 1,000+ | Spots: from 0.100% / 0.100% to -0.005% / 0.025%; Futures: from 0.020% / 0.060% to -0.008% / 0.025% | Projected Funding Rate for BTC Perpetual/USDT - 0.0073% | Yes (Custodial) | Yes | Up to 1:100 for futures contracts | 0.000001 BTC | Credit/Debit Card, SEPA Transfer, Bank Transfer, ApplePay, GPay, Revolut, PaySera, Skrill, Advcash, Interac, and more | SFSA (Seychelles), FIU (India) | 1.6 ⭐ |
MEXC
Established in 2018, MEXC remains a leading global centralized exchange, powered by high-capacity transaction matching technology capable of processing up to 1.4 million transactions per second. The exchange has expanded its global reach and now serves nearly 40 million users across more than 170 countries and regions.
Through our active exchange reviews, we confirmed that the platform offers approximately 2,700 spot markets and more than 960 futures markets. Minimum order sizes vary by crypto asset, while maximum leverage reaches 1:5 or 1:10 for spot margin trading. Up to 1:500 leverage is available on specific futures markets.
Based on our platform evaluations, we verified the available fee schedules. Users can benefit from spot maker fees of 0.0000% and taker fees ranging from 0.000% to 0.0500% for most trading pairs. For futures trading, maker fees range from 0.000% to 0.040%, while taker fees stand between 0.000% and 0.100%.
The exchange does not charge deposit fees. Traders can check minimum withdrawal amounts and fees for each supported cryptocurrency, with some digital assets available for fee-free withdrawals. MEXC Savings allows users to earn returns on their crypto holdings through locked and flexible savings products. Key security features include the $100M Guardian Fund and the Futures Insurance Fund.
Bybit
With 80M+ users worldwide, $35B+ in daily average trading volume, and a presence in 241 countries and territories, Bybit is a strong contender in crypto trading. The exchange launched in 2018 and quickly gained traction among crypto traders and investors. VARA in Dubai, the National Bank of Georgia, and Kazakhstan’s AFSA are among the regulators overseeing its operations. In 2025, Bybit reinforced its global compliance efforts by securing a MiCAR license through Bybit EU GmbH, allowing it to offer regulated services across EEA countries.
During our real-time exchange assessments, we evaluated Bybit’s trading ecosystem and confirmed that it supports more than 2,995 listed cryptocurrencies. Our live tracking verified a transparent fee structure across its products, covering both crypto-to-crypto and crypto-to-fiat pairs.
Fees vary by user type, with VIP and PRO levels determined by available assets or 30-day trading volume. For non-VIP accounts, Bybit charges a 0.0100% maker fee and 0.100% taker fee on spot crypto-to-crypto markets, 0.0200% maker and 0.0550% taker fees on perpetual and futures contracts, and 0.0200% maker and 0.0300% taker fees on options trading. Bybit is widely recognized for its user-friendly interface. Our technical review checked leverage limits across supported products, including up to 1:200 for Smart Leverage. Perpetual and futures contracts allow maximum leverage of 1:100, while spot margin trading is capped at 1:10. The company also offers high-end security measures and helpful educational resources.
KuCoin
Founded in 2017, KuCoin is a trustworthy crypto exchange, allowing traders to buy, sell, and trade Bitcoin and nearly 1,000 altcoins in a secure environment. The exchange serves 45+ million users across more than 200 markets and territories and is available in over 20 languages. It has built a strong reputation for its customizable interface, fast transaction speeds, and comprehensive mobile app, making it suitable for both beginners and experienced traders.
One of KuCoin’s attractive features is its staking program. More than 40 coins are supported, allowing traders to earn rewards by holding selected crypto assets. Annual percentage rates vary from 0.3% to 13%, depending on the coin. KuCoin also offers flexible savings products and liquidity mining opportunities, giving users several ways to earn passive income on their holdings.
Active traders can benefit from competitive fees based on trading volume. We confirmed that maker/taker fees vary according to the trader’s VIP level, from LV0 to LV12, and 30-day trading volume. LV0 users with a 30-day spot volume below 1,000,000 USDC are charged 0.100% maker and 0.100% taker fees. Our technical review checked margin and leverage caps across different environments. Maximum leverage on KuCoin Futures is 1:100, while the default leverage is 1:20. The exchange also offers up to 1:10 leverage in spot margin markets. When traders open the exchange website, they can see lists of hot coins and recently added assets. KuCoin is also known for listing promising tokens early, giving users exposure to emerging market opportunities.
Kraken
Kraken is another trustworthy exchange that allows traders to explore various crypto investment opportunities. The platform has served investors since 2011 and has 10+ million clients across more than 190 countries and territories. Kraken’s 24-hour trading volume exceeded $1 billion at the time of writing, while investors can buy and sell more than 600 crypto assets, including Bitcoin, Ripple, Cardano, Solana, and Ethereum. Our technical review confirmed maximum leverage of 1:50 for Kraken Futures and 1:10 for spot margin trading.
Kraken also allows users to automate recurring buys of hundreds of supported cryptocurrencies on a daily, weekly, monthly, or custom schedule. This helps traders spread purchases over time without trying to time the market, while retaining flexibility over amounts and payment methods.
Based on our active platform evaluations, we analyzed Kraken’s multi-tiered pricing schedules. The exchange charges a 1% fee on instant and recurring trades and a 1.5% fee on custom orders via its basic interface. For advanced spot trading, maker fees range from 0.25% to 0.00%, while taker fees range from 0.40% to 0.05%, depending on 30-day trading volume. For derivatives, baseline maker fees start at 0.0200% and taker fees at 0.0500%, with maker rebates of -0.0060% and taker fees of 0.0125% at the highest tier.
Crypto traders can earn flexible or bonded rewards on 26 supported assets, although geographic restrictions may apply. Kraken has paid $800M+ in rewards, with earnings distributed weekly in the same asset. Cosmos holdings can earn up to 21.95% APR bonded, while Ethereum staking starts from 2.36% bonded.
OKX
Established in 2017, OKX is a Seychelles-registered company offering advanced crypto trading services to customers in more than 100 countries, excluding the US and several other restricted jurisdictions. Based on our platform evaluations, we verified that the exchange supports more than 240 cryptocurrency tokens and 300 trading pairs across spot, margin, and derivatives markets. It also provides a professional-style interface with algorithmic orders, institutional-grade liquidity, an advanced API, and TradingView integration for chart-based trading with technical indicators and drawing tools.
Trading fees vary by user level, determined by assets under management and 30-day trading volume. Level 1 users with assets of up to $100,000 or 30-day volume below $1,000,000 pay maker fees of 0.0800% and taker fees of 0.1000%. As AUM or trading volume increases, fees improve with each VIP level. VIP 9 users, with AUM above $500,000,001 and 30-day volume between $1,000,000,001 and $5,000,000,000, receive maker rebates of -0.0075% and pay taker fees of 0.0175%.
The 24-hour crypto withdrawal limit for regular users is $10,000,000, while VIP 8 and VIP 9 clients can withdraw up to $80,000,000. Exact limits and network fees vary by asset and blockchain. Our research team verified that OKX offers up to 1:10 leverage on spot margin and up to 1:100 on futures and perpetual contracts.
How Does Leverage Work in Crypto Trading?
If you are interested in trading cryptocurrencies but have a limited budget, leverage can be helpful, but it also carries risk. It enables traders to boost their trading power by using borrowed funds without committing the full amount of capital upfront. However, use it with utmost caution, since enhanced exposure to the crypto market can mean both enhanced profits and larger losses.
Leverage is used to increase buying power beyond the actual investment by borrowing funds from trading platforms. For instance, with a 1:10 leverage ratio, a $1,000 investment can increase a trader’s exposure to the market to $10,000. In other words, for every $1 staked, they control $10 worth of trading funds. If the market moves favorably, traders can increase their gains. Assuming the trading position is profitable, a 10x-leveraged trade would generate 10x the profit compared to a non-leveraged trade.
Unfortunately, the opposite is also true. While it can be tempting to use the maximum allowable leverage, investors should align their trading goals with their budget. They risk losing their entire stake if their position drops by a certain percentage. For instance, if you stake $1,000 at a leverage of 1:200, the position size becomes $200,000, and the margin is $1,000, or 0.5%. If the market moves unfavorably and the trade drops by just 0.5%, your entire $1,000 stake will be gone.
As of 2026, the maximum allowable leverage limits vary across platforms and crypto assets. Trades involving major cryptocurrencies such as Bitcoin (BTC) and Ethereum (ETH) typically offer the maximum allowable leverage, whereas trades involving altcoins offer lower leverage levels. Additionally, regulatory developments in certain jurisdictions have resulted in some platforms adjusting their leverage offerings based on their customers’ position sizes and risk profiles.
In summary, while leverage offers higher profit potential, it requires strict discipline, risk management, and a clear understanding of how market movements can impact a position.
What Is Margin in Crypto Trading?
Traders can think of margin requirements as the initial capital they need to open a leveraged position. They need to pay attention to the margin requirements of different platforms, as each has its own terms. Similarly, leverage ratios also vary based on the regulatory requirements of the financial bodies that oversee the particular trading platform, the status of traders (retail or professional accounts), and the margin applied. For instance, a leverage of 1:10 corresponds to a margin of 10%.
Leverage ratios can vary between 1:2 and 1:200 across most of the trading brokers and exchanges we have reviewed in the current publication. Crypto traders must be aware of what these ratios represent. They generally denote how much they control for each cryptocurrency unit in their trading account. A 1:50 leverage, for instance, denotes that for every $1 in a trader’s account, they can control $50 worth of a crypto trading pair.
Margin calls are an important aspect of leveraged positions. Margin calls typically occur during periods of extreme volatility, and traders are either required to add extra funds to their accounts or close the leveraged positions at large losses or even complete losses.
Margin and leverage are often used interchangeably, as they refer to the same concept and allow traders to control larger positions in the market, yet there is a subtle distinction between the two. While leverage is the multiple by which traders increase their position, margin is the amount of money necessary to open a leveraged position.
Risk Management for High Leverage Crypto Trading
In the potentially profitable yet unpredictable field of crypto trading, investors can use important protection mechanisms to mitigate the associated risks and reduce losses. With prices that fluctuate significantly, traders need to be aware of effective risk management methods.
Traders should approach crypto trading with leverage in a disciplined and responsible manner. The following risk management tools and strategies can be valuable in keeping losses to a minimum when using leverage:
Careful Research
Before investing in a particular cryptocurrency, traders are advised to conduct careful research, using fundamental analysis, technical analysis, and sentiment analysis.
Portfolio Diversification
Spreading risk across different cryptocurrencies can reduce losses, although it cannot eliminate them. Besides crypto assets like Bitcoin and Ethereum, crypto traders may consider altcoins such as Solana and Cardano, although they are inherently riskier. Portfolio diversification can reduce the negative impact of a single asset’s underperformance. Note that in market crashes, all crypto assets tend to correlate to the downside.
Stop-Loss Orders
A stop-loss order can be a safety net designed to limit a trader’s loss on a position by automatically closing trades at a specific price if the market moves in an unfavorable direction. Setting stop-loss orders can effectively manage risks associated with crypto trading with high leverage. Keep in mind that if prices gap down below your stop-loss price, you will not necessarily get the price you wanted.
Take-Profit Orders
Take-profit orders are used when a specific profit level is reached. In other words, setting take-profit orders is designed to help traders lock in their profits automatically and close trades. They are often used in conjunction with stop-loss orders.
Avoiding Excessive Leverage
Traders may be tempted to use 100x leverage, as it may magnify a 1% profit to a 100% profit. However, if trades move unfavorably, a decline of just 1% will wipe out the entire position.
How to Pick the Best Crypto Trading Platform for High Leverage Trading?
If you want to benefit from the opportunities that crypto-asset trading with high leverage can bring but find it challenging to pick a trustworthy trading platform, we can give you some direction on the most important aspects to look for.
Trading Fees
Whether you prefer trading with a crypto broker or an exchange, you might want to review the associated trading fees. When trading CFDs, beyond the bid/ask spreads, traders need to check the overnight funding charges, inactivity fees, deposit and withdrawal fees, and guaranteed stop order fees. Crypto exchanges generate profits by taking a percentage of every trade; hence, traders must check the maker and taker fees. Typically, exchanges offer a tiered fee structure whereby traders with larger trading balances and trading volumes are compensated with lower fees.
Crypto Assets Available for Trading
A broad enough selection of cryptocurrencies is important, as it allows traders to diversify their portfolios and spread risk across different assets. While crypto brokers tend to offer fewer coins, predominantly focusing on major market-cap assets, exchanges offer a wider variety of crypto assets, spanning new and niche coins, stablecoins, and trading pairs.
Types of Trading Accounts
Crypto trading brokers typically offer several account types to cater to as many traders as possible. Retail and professional traders will find the account types that align with their trading goals. Demo accounts allow traders to practice trading without investing any real funds.
Exchanges, on the other hand, organize their pricing structures based on traders’ available assets under management and trading volume over the last 30 days. With several different tiers of VIP status, traders can get access to more competitive fees as their assets and trading volume increase.
Supported Deposit Methods and Withdrawal Speed
The range of supported deposit methods is also an important factor. The process of depositing and withdrawing funds should be fast and effortless, with minimal or no transaction costs involved where possible.
Regulation
Licenses and a secure trading environment are other important aspects to look for in crypto trading platforms. Most brokers and exchanges hold licenses from multiple financial regulators, depending on the countries and regions they operate in. Some of the top-tier regulatory bodies within the financial industry are the FCA, CySEC, ASIC, and CFTC. Platforms operating under reputable regulators must comply with strict transparency, fund segregation, and reporting standards, which provide traders with additional safety.
Risk Management Tools and Investment Protections
As mentioned, risk management tools for high-leverage crypto trading are a fundamental aspect of responsible trading. Trading brokers provide various investment protections, such as negative balance protection and compensation funds. In addition, some exchanges offer automated margin call systems and liquidation alerts to help traders monitor their positions more effectively.
Educational Resources
Successful crypto trading requires learning and processing information, and trading platforms that offer educational resources can be helpful. The resources may include video tutorials, webinars, articles, and demo accounts, which can help traders acquire the necessary skills.
Trustpilot Score
Last but not least, when picking a crypto trading platform, traders must look for reviews and feedback from other users that clearly show their satisfaction with the particular company and the way it handles negative feedback. Trustpilot is a reliable platform with reviews and ratings for multiple crypto trading brokers and exchanges.
Leverage Trading in Spot vs Derivatives Markets
Top-tier crypto trading platforms enable investors to trade cryptocurrencies in various ways. Some of the most common instruments for trading digital currencies are spot trading and derivatives such as CFDs, options, and futures. We will briefly cover these instruments and the leverage that traders can use.
Spot trading in cryptocurrencies involves the actual buying and selling of digital assets at their current market price. Newer traders typically choose this method as it is uncomplicated, and they actually own the underlying assets. To generate profit, traders aim to sell the crypto assets at a price higher than the one they paid. Spot trading is typically done without leverage. Those who prefer trading on the spot market with leverage should note that commissions are potentially higher.
Crypto contracts for difference (CFDs) have gained popularity among traders as they allow them to profit from price fluctuations without the need for ownership of the underlying assets. With no need to buy or own crypto, traders simply speculate on rising and falling prices. With crypto CFDs, traders can leverage their positions and increase their exposure to the market. Leverage ratios vary based on jurisdiction and the status of traders (retail or professional). Additionally, trading crypto CFDs eliminates the need to store coins in crypto wallets.
Futures are derivative contracts that require the parties involved to buy or sell a crypto asset at a preset price and date in the future. Traders can leverage their positions and may receive higher profits than non-leveraged trades if the markets move in their favor, but they can also incur greater losses if markets move against them.
Options are derivative instruments allowing investors to buy or sell assets at a preset price on a particular date, with no obligation to do so. Leverage may also be available.
Pros and Cons of High Leverage Crypto Trading
Crypto trading with high leverage comes with a set of advantages and disadvantages. Below are the main pros and cons of trading cryptocurrencies with high leverage.
Key Pros
- Increased market exposure and potential profits: As a result of gaining access to borrowed capital, traders increase their market exposure and potential profits. They can multiply their gains by 2x, 10, or as much as 200x on their successful crypto trades, if the broker allows that amount of leverage.
- Less capital required: By using leverage, traders can enter the market with less capital. They can control a larger amount of assets with a smaller initial investment.
- Volatility: Cryptocurrencies are among the more volatile financial assets but their volatility is not necessarily a setback. Swift price variations provide favorable trading conditions for experienced investors, enabling them to potentially achieve quick profits.
Key Cons
- Magnified risk of losses, margin call risk, liquidation risk: Just as leverage increases the potential for magnified profits, it does the same for the risk of potential losses resulting from small fluctuations in asset prices. Besides the initial margin requirement, leveraged trades also involve a maintenance margin requirement. The latter is the amount of collateral needed to keep the position from liquidation. Margin calls occur when there is a need for additional margin to keep the position open. Liquidation is the largest risk traders face when trading crypto with leverage. It happens when traders have insufficient funds to keep a leveraged position open.
- Choosing the optimal leverage ratio: Novice traders may find it challenging to pick a suitable leverage ratio. Going for lower leverage ratios is recommended, so new traders reduce the associated risks to a minimum.
- Crypto trading regulations vary across jurisdictions: Crypto trading regulations vary across different jurisdictions and traders must be aware of the permitted and prohibited crypto trading instruments, as well as the maximum allowable leverage for the country they reside in. For instance, top-tier regulators such as the CySEC (EEA) and the ASIC (Australia) have set a maximum crypto trading leverage of 1:2 for retail customers.