Do not use more than 2x leverage
Do not use more than 2x leverage
I am referring to Vitalik Buterin, one of the ethereum founders post on Twitter that states that people should not use more than 2x leverage.
Don’t use >2x leverage. Just don’t.
It is one of the things he listed as a financial advice. As a trader, what do you think about it? We set some money aside for trading and as for me I still use up to 2.5x leverage for bitcoin to open a long position.
I think using this low leverage is good for traders. But investors should not use leverage at all. Investors should even supposed not to leave coins on exchanges but moved the coins to a noncustodial wallet.
This is also not applicable to many coins that are very volatile in a way that 1x leverage can even lead to liquidation of asset. See what happened to TRB recently that fall from almost $700 to $125.
This is part of a list if I’m not mistaken, and based on my understanding this is all tips he gave to people who are looking to invest in the crypto space as newbies. Despite that however I don’t think what he’s saying couldn’t be true for us pros, as even us fall short sometimes especially when it comes to our price predictions and positions.