Best Crypto Margin Trading Exchanges:
note: 10x means 10 times. For example, when placing a spot trade with 10x margin, a user must keep $1 as margin and can place the order worth $10. Here the exchange will lend $9.
Reading: Bitcoin margin trading exchanges
We all know that the cryptocurrency markets are the most volatile in the world. therefore, one of the best ways to make money in the crypto sphere is to trade cryptocurrencies.
Generally known as day trading, it can be very risky and rewarding at the same time. To make life-changing money through trading, a trader must be proficient and use different trading methods.
margin trading is the riskiest form of trading. if used correctly, it can also become the most profitable trading method.
Just to start, margin trading is a form of trading where you trade with borrowed money. To borrow this money, you need to have some collateral. this method of trading with borrowed money is also known as leverage.
for example if you have $100 and the exchange allows 10x margin on btc spot trading. so in this case you can place an order (both long and short) worth up to $1,000. this process of trading more than you can actually afford is known as margin trading.
In simple words, it is like borrowing money and investing it in cryptocurrencies.
However, a user should be aware that should the market move in an opposite direction to their position, the exchange may force the sale of these assets and liquidate their holdings.
note: margin trading, in general, is very risky, crypto margin trading is even riskier. therefore, it is a strict no for beginners as veteran traders can also incur huge losses on margin trading.
However, if you are good at regular day trading, you can start testing margins for smaller amounts for crypto trading.
cryptocurrency exchange with the best margin
here is a list of the best crypto leverage trading platforms:
Binance is the world’s best cryptocurrency exchange with maximum liquidity, trading volume, and a number of users. Read our full review on Binance here.
The exchange supports margin trading, which a user can understand and execute in a few simple steps. To use Binance margin trading, you must complete identity verification (KYC), and your country must not be on the Binance country blacklist. Currently, US residents uu. they cannot use the binance margin trading feature.
In addition to this, the exchange has a margin insurance fund to save its overall liquidity. In the event that a trader goes bankrupt during margin trading, and his assets are not enough to pay his debts, then the exchange will pay the trader’s debt from this insurance fund.
Margin trading can be used for both long and short positions. The exchange allows up to 10x margin on spot trading and up to 125x on derivatives trading.
The interest rate on borrowed amounts changes frequently and can be found here. Additionally, you can choose to pay margin trading interest in the form of BNB (Binance In-House Token), saving you an additional 5% in interest.
also, as an alternative to margin trading, binance offers leveraged tokens. These tokens allow traders to place short or leveraged positions without having to trade on margin. For example, a trader who wants to 3x short bitcoin can simply buy a 3x short bitcoin leveraged token on binance. Leveraged tokens are standard crypto tokens and can be traded on any spot exchange (even those that don’t allow margin trading). Furthermore, by buying a leveraged token, the investor is spared the hassle of maintaining a required margin with the exchange.
Bybit is a specialized platform for derivatives trading. The exchange was established in 2018 and currently has more than 2 million registered users.
bybit deals in a number of perpetual and futures contracts. the platform has launched a pilot test for spot trading which should be available to all users in the near future.
They also offer up to $90 free bonus to join, which you can use to trade on margin. the fee is one of the cheapest and it is an exchange without kyc. however, to use a third party service such as fiat trading, the user would need to obtain their kyc on the platform.
bybit has significant market depth and liquidity. therefore, it is an exceptional platform for margin trading.
For margin trading, bybit offers margins up to 100x. In addition, Bybit has its own insurance funds that can be used to recover losses in the event that a trader goes bankrupt.
the bybit mobile app is something I would use most of the time to trade. the trading engine is blazingly fast and it is the fastest growing margin trading crypto exchange. You can learn more about bybit in my detailed bybit review.
bybit is easier to use even for new leveraged traders. bybit also offers 24/7 (multilingual) customer support, which is one of the best. bybit is headquartered in singapore and has offices in several countries.
FTX is a cutting-edge crypto exchange with a number of exciting features that was established in May 2019. In general, the FTX exchange provides an immense amount of liquidity to its users with its 3 Tier Liquidity Protocol and FTX Insurance Fund. Read our full review on the FTX Exchange here.
By default, all positions use the same set of margins. each sub-account has a central collateral wallet and uses cross-margin for the account. furthermore, a user has the option to use a particular margin in isolation. the exchange provides up to 101x leverage on its products.
just like binance, ftx exchange also offers various leveraged tokens. ftx.com does not serve US residents. we residents would need to use ftx.us.
margin trading fees
ftx charges a marginal fee that is already included in the loan rates. This means that a borrower will have to pay a slightly higher interest rate compared to what a lender would receive. ftx will keep the spread as a fee for margin trading. On top of this, fx only charges the typical trading fee.
All loan rates are variable and change hourly. you can check the loan rate here.
Based out of San Francisco, Kraken is one of the largest cryptocurrency exchanges in the USA. It is the second-largest exchange (after Coinbase) in terms of trading volume and number of users that caters to the residents of the US. Read detailed Kraken review to learn more about this popular exchange.
also, despite catering to residents, kraken offers a wide variety of crypto tokens. Kraken offers on-the-spot margin as well as derivatives trading. the leverage allowed in these operations is up to 5x.
currently the following tokens are supported for margin trading on kraken:
kraken has listed the eligibility criteria that will determine if a user is available to trade on margin. you can refer to the same thing here. In addition, the fee structure for margin trading can be found here.
The trading fee for margin trading is also very reasonable. you can find more information about this here.
KuCoin is one of those amazing crypto exchanges which offers a wide variety of services and crypto tokens. Most of the low market cap gems can be found on this platform.
Due to an interactive user interface and the high liquidity of the platform, I could not keep this platform off my list of crypto exchanges with the best margin trading.
kucoin offers up to 10x margin on spot trading and up to 100x on derivatives trading. Furthermore, just like Binance and FTX exchange, Kucoin also offers a number of Leveraged Tokens, which are a better version of margin trading as they do not face the risk of asset liquidation.
margin trading interest rate on kucoin changes frequently and can be checked here.
BitMEX facilitates margin trading for cryptocurrencies and has gained quite a lot of respect in the cryptosphere in a rather short period of time.
The team consists of experienced developers, economists, and high-frequency algorithm traders, making it a reliable product. Bitmex is not available to US customers. In the US, however, you can bypass it using any vpn service.
bitmex registration process is simple as you only need your email to get started, plus you can also secure your funds using the 2-fa authentication feature that bitmex provides.
Currently, bitmex offers margin trading for 6 cryptocurrencies, of which bitcoin margin trading is the most famous. here is the fee, as well as the leverage schedule for all cryptocurrencies:
- read: bitmex review
Phemex is one of the newer crypto exchanges on the list. The platform was established in November 2019 in Singapore by an ex- Morgan Stanley employee, Jack.
The exchange has captured a substantial user base and transaction volume in a short period of time. this is due to the platform’s promotional bonuses and high leverage. phemex has over 5 million users with an average 24 hour trading volume of approx. $8 billion.
Also, the exchange does not need the client’s kyc. users can simply sign up, deposit assets and start trading on the platform. however, for non-kyc customers, some services, bonuses, and benefits are not available. Please note that phemex does not serve residents.
The exchange offers up to 100x leverage on derivatives trading. furthermore, the derivative transaction fee is 0.075% for the policyholder and -0.025% for the maker. this means that a manufacturer would receive a commercial rate.
You can read more about the phemex fee structure here.
Founded in 2013 in London, CEX.io is one of the oldest exchanges in the crypto industry. The exchange is registered with FinCEN (Financial Crimes Enforcement Network). Due to this, it applies appropriate KYC (Know Your Customer) and AML (Anti Money Laundering) procedures.
cex.io offers over 100 tokens available in over 200 token pairs. additionally, margin trading is available up to 10x on these tokens.
The exchange is available in most US states. uu. however, the margin trading service is not available to US residents.
the exchange charges a trading fee of 0.25% to buyers and 0.15% to creators. this is further reduced with an increase in your trading volume.
you can check the cex.io fee schedule here.
conclusion: margin trades
so, this was my list of the best crypto margin trading exchanges out there. You need to understand that while all these exchanges are good for trading, they are also a honeypot for hackers to attack.
Furthermore, as these exchanges cater to a large sum of money, this risk increases multiple in the case of margin or leveraged trades.
so even if you only day trade or margin trade, you should be careful keeping your money on these exchanges as it is not safe. the above exchanges provide additional security features such as 2-fa authentication which you should never forget to use.
I must reiterate that margin trading is a highly risky form of trading, and users should use their discretion.
Now is the time to hear from you: Do you trade cryptocurrencies? Do you indulge in margin trading? where do you trade or margin trade cryptocurrencies?
Please share this article with your network if you find it useful!
further suggested reading:
- Top 9 Cryptocurrency Exchanges in the World
- Best Smartphone Apps for Trading Crypto on the Go
- 3commas Review: Is It Safe? how does 3 commas work?