What is Leverage? -

Leverage in the cryptocurrency world can play a vital role in increasing the amount of profits earned. However, it comes with higher risk of losses too. Leveraging is like a loan that allows you to borrow collateral funds to boost your position to levels higher than your wallet balance making it possible to increase your potential returns.
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For example, if you would like to invest $500 in a cryptocurrency with only $50 available in your wallet, you can use a leverage ratio of 1:10 (10x) to make it possible, as the position is multiplied tenfold.
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In futures contracts, you can open both long and short positions using leverage which allows you to profit from short-term price movements regardless of a bull or bear market. This type of trading is best suited for those with an investment strategy of taking advantage of market volatility, and price movements in the future.
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On the other hand, leverage also comes with higher risks. The higher the leverage ratio, the greater the risk of losing your investment money, especially if you haven’t set your stop-loss positions. If the market goes in the opposite direction from your position, your total futures portfolio may get liquidated! You should choose the best trading methods for their investment strategy and risk tolerance. The choice is yours! Always do your research before investing!
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Disclaimer: Cryptocurrency and Digital tokens are highly risky; investors may lose all their investment money. Investors should study all the information carefully and make investments according to their own risk profile. Past performances do not guarantee future performances.
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Source
https://www.investopedia.com/terms/l/leverage.asp
https://www.investopedia.com/terms/b/buyingpower.asp

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