FTX And Binance Both Reduces Leverage From 101x To 20x

FTX and Binance, both world’s fastest-growing cryptocurrency exchanges, has stated that they will reduce the maximum leverage available to traders on its platform, with the maximum leverage now set at 20x.

L-R Binance Ceo Changpeng Zhao and FTX Ceo Sam Bankman-Fried via ftx.com

FTX has justified its decision by claiming that higher leverage trades account for less than 1% of total volume on its platform, and that the average leverage used at the exchange is only around 2x.

Furthermore, Binance CEO Changpeng Zhao emphasised that the new user limit began seven days ago (July 19), and that it will eventually be extended to all users.

Zhao, on the other hand, did not provide any explanation for his choice. He simply stated, “We didn’t want to make this a thingy.” He did, however, acknowledge that the adjustments were made to protect consumers.

Yet another news and yet another tweet. People posted their warm thoughts and recommendations in the microblogging site.

A twitter user tweeted that he has just started the leverage options and both the crypto exchange platform reduced it.

Bankman-Fried also mentioned in his Twitter thread that, “high leverage is a small part of positions, not a big contribution to volatility. And that many arguments against it ‘miss the mark.”

Director of news The Block, Frank Chaparro said that 100x levergae isn’t feasible and can risk your earnings.

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