Saturday, June 22, 2024

Crypto exchanges limiting margin

By DAC000 , in Regulation , at July 27, 2021 Tags:

as reported by Forbes this AM, FTX is the latest exchange to limit margin. FTX is now limiting margins trades to 20X from it’s prior, 101X cap. About a two minute read.

Comment: another sign crypto is maturing, or are exchanges trying to front run the upcoming regulatory onslaught? The truth is likely in the middle, but let’s face it — buying on margin is like riding a roller coaster. Leveraging 101X isn’t a valid strategy, a little volatility and you’ve got a problem. And I’d argue even 20X isn’t appropriate. I don’t margin anything — stocks, commodities, property or crypto. Best just to live within your means and only buy what you can afford. Less stressful, you’re in full control and you no longer fear market / asset volatility.

FTX CEO’s Twitter thread below:

Finance Facts on Margin