What Is the Maximum Leverage Typically Offered on a Crypto Perpetual Swap?
The maximum leverage typically offered on a crypto perpetual swap can be extremely high, with many offshore exchanges offering up to 100x or even 125x leverage. While this allows traders to control a large position with a small amount of capital, it significantly amplifies both potential profits and losses.
Regulated exchanges in jurisdictions like the US or EU typically impose much lower limits (e.g. 2x to 20x) to protect retail investors from the high risk of rapid liquidation.
Glossar
Maximum Leverage
Amplification ⎊ Maximum leverage, within cryptocurrency and derivatives markets, represents the utilization of borrowed capital to increase the potential return of an investment, fundamentally altering risk-exposure profiles.
Crypto Perpetual Swap
Instrument ⎊ The Crypto Perpetual Swap is a non-expiring derivative instrument designed to mimic the price action of an underlying cryptocurrency spot market.
Perpetual Swap
Mechanism ⎊ Perpetual swaps, within cryptocurrency markets, represent agreements to exchange cash flows based on the difference between a cryptocurrency’s current price and a user-defined price, perpetually, without an expiration date.