I was going to post this in the "Crypto Mania" thread that got locked because it fit in with my question about leverage. I ran into this advertisement a few minutes ago and thought some would find it interesting.
1:100 leverage trade with PrimeXBT
Here you’d only have to pay 1% of your $100,000 position, or $1,000 to open such trade. If the Bitcoin price rises by 5%, you would still make the same profit of $5,000, but at a considerably reduced cost.
That means that profits can be hugely multiplied.
source:
https://primexbt.com/trade-bitcoin-with-leverage
Earlier today I posted this:
Good question. If the collateral is crypto, and a market correction drops the value of the collateral triggering a liquidation, doesn't that further depress the markets, which trigger the next rung of collateral to be liquidated, depressing the market further, triggering the next rung, etc. In the traditional financial world, most collateral is required to be of stable value and cannot be used over and over again for different loans right? That sounds like a Robinhood world.
Can I deposit $100k into crypto and invest it, then use it as collateral for a cryto loan and invest that borrowed crypto, then get another loan off that investment... to invest... etc? This sounds like a really dumb question but while I feel I have a decent grasp of the tech side of blockchain/crypto, I haven't kept up with the "ecosystem".
So with 100x leverage... can I deposit $100k into crypto and invest with 100x leverage to get 10,000k crypto that can be used as collateral for an enormous loan and invest that loaned crypto with 100x leverage... etc? This can't be possible can it? It sounds like something that would get posted on Wallstreetbets for instant celebrity status.
I think this fits in the "Prepare to lose all your money" thread.