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Explain the Concept of Margin Trading in Crypto Derivatives.

Margin trading involves borrowing funds from a broker or exchange to trade a larger position than one's capital would normally allow. The margin is the collateral deposited to cover potential losses, which is a small percentage of the total contract value.

This use of borrowed capital, or leverage, magnifies both potential profits and losses. If losses deplete the margin, a margin call or liquidation occurs.

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