Crypto Academy Week 12 | Homework Post for @stream4u

in hive-108451 •  last year 

Hello every one welcome to week12 in our crypto academy that is just growing stronger and stronger every day, in today home work we going to be completing a home work about Crypto Margin Trading & Crypto Leveraged Tokens Trading which is a lectured covered by our professor @stream4u so let me get it done.

Questions and Answers

1). What Is Crypto Margin Trading?

It can be explained as the type of investment or trade that gives users of an exchange access to bigger capital that is borrowed from traders, the exchange offering margin trading or from even brokers in other words margin trading is the type of trading that offers traders that are unable to raise the specific capital for that trade the specific capital so that they can access the trade in other to make bigger profits.

To explain further i will give an example which is if john open a trade with $1000 and agreed on 5x leverage which now gives him an additional $4000 which is now amounting to $5000 which now enables him to not only get more profit but also can lead him to more losses On the off chance that the trades closes in 5% profit/loss, he makes 5% x 5x = 25% profits/loss. This implies that he makes either an extra 25% benefit of the $5,000 invested or 25% misfortune of the $5,000 utilized in the trade. Margin Trading may be a twofold edge sword which either makes a trader way better off or more awful off. Moreover keep in mind that the user pays interest in either ways the market goes to the exchange platform. This kind of exchange isn't for beginner or newbies who newly joined the crypto exchanging platform.

These are the main features of margin trading.

  • A user must reach specific requirements before he/she can apply for loan that they want to use to trade.
  • After loaning funds you will be paying interests
  • This type of trade can give you big profits and big losses too

For example you as a trader has $100 and is trying to make more profit then you margin trade which gives your $100 the power of $500 which can now lead to more profit but when your trade looses then you loose all your capital with the interest you will need keep paying interest because the money given to you to enter that trade was borrowed.

There are two types of Edge trading seen within the cryptocurrency margin trading.

+ Isolated Margin Trading:
Opening a trade in isolated margin trading is the type of trade that is separated in to different sub accounts, this type of margin trade is advised for new comers because it is less risky because losses only affect the individual capital hence does not affect the main margin account. Losses are controlled in this type of margin trading.

+ Cross Margin Trading
Opposite to what is seen in isolated margin trading because position entered in this type of margin trading are all from the margin main account that is why this type of margin trading usually used by experienced traders because Losses or profits made in this trading tool directly affects all positions entered.

2). How To Plan For Trading In Crypto Margin Trading

In every trading scenario there is always planning involved so it is smart that a traders ought to be beyond any doubt of the trend of an asset price behaviour before entering such trades. Also Note that, crypto margin trading is categoriesd as a highly unsafe investment and dealers ought to consider opening numerous positions that wins them fast benefit and not get too greedy by opening a position with high profit as that can turn to be a misfortune within the long run.

If you are planning to trade then you need to visit the chart and enter the 15 min time frame chart because it is used to plan a crypto margin trading using the BNB/USD pair (explored from TradingView).

Btc chart

In this Btc chart above you can see that $58000 there is a very strong resistance because this the third time Btc is hitting it but keeps coming down again.

3). Crypto Exchanges Name That Provide Margin Trading Service and What Margin They Provide?

I). Binance Exchange offers margin trading services like isolated and cross margin with a leverage of up to 100x

II). Bybit offers margin trading services like isolated amd cross margin with leverage up to 100x

III). Poloniex offers margin trading with leverage up to 100x

Iv). Bitmex which offer mainly bitcoin margin trading also offers cross marging trading with leverage upto 10x

V). PrimeXBT

Vi). Kraken

4). What Is Leveraged Tokens Trading

Leverage Tokens Trading is the type of crypto trading where by traders don't need to own the asset used in trading but rather enter a contract with an exchange platform that offers trading of leveraged tokens to enter a long (buy) or Short (sell) position.

For example if i have $10 and i want to trade leverage then i will have to predict the price of an asset and enter a contract which is either a long(buy) or short (sell) with 3x leverage that means my $10 now has the power of $30

Merit of leverage trading

  • it gives traders the opportunity to trade asset that they don't own
  • it enables users to earn more profit
  • it doesn't matter whether the market is going down because you can still trade it.

Demerit of Leverage trading

  • This is a very risky investment so as a trader you need to be aware
  • Crypto liquidation is possible

6). How To Plan For Trading In Leveraged Tokens?

This questions has answer that you will get from exchanges that offer leverage and the answer is you as a trader should know how to read charts of and asset and you also need to learn how to manage risk because leverage is a risky thing.

7). Crypto Exchanges Name That Provide Leveraged Tokens Service and What Margin They Provide In Leveraged Tokens?

I). Binance provides up to 4x leverage
II). Bybit provides up to 10x leverage
III). Coinbase provides up to 3x leverage

8). Price Forcast For Crypto Assets XXXXXX. (This is similar question from last course, take any Crypto Assets Chart graph, as per its current price and its market trend predict its future price for only next week, what will be its future price for next 1 week.You can predict for any direction up or down but explain it properly on what basis you have predicted the price. What will be the possible low level and high level fornext week.).


The chart above is BNB to usd chart and it shows a rising wedge that broke up and this is a very bullish sign because if the market continue in this bullish trend can see the price pump up to $800 next week.

Leverage and margin trading are similar and can be highly profitable and highly unprofitable so newbies are not advised to trade this until they are professionals anyway thanks for reading @stream4u.

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Hi @okoyejoshua

Thank you for joining The Steemit Crypto Academy Courses and participated in the Homework Task.

Review Visit Level
Task Remark
Guidance, Feedback, Suggestions
Verification (Done, Hold)
Provided information are explained well.However, on topic the Leveraged Tokens Trading and the Price Prediction, you could have done better try to go for more detail
Try to explore the topic with each small details, explain image/chart in more specific details with some close views.

Your Homework Task verification has been done by @Stream4u, hope you have enjoyed and learned something new.

Thank You.
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