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Without any doubt, trading with leverage is extremely profitable. With leverage trading, you can use a small amount of capital to take a large position in the market. There are lots of crypto exchanges that offer you leverage trading. Among them, FTX is one of the known names. So the question is, how to leverage trade crypto with FTX?
If you have a similar question in your mind, let me go ahead and share a step by step guide with you.
So let’s get into the topic right away:
What is FTX and its leverage trading margin?
FTX is one of the popular cryptocurrency exchange trading platforms. It allows you to trade in a wide range of products and instruments. Such as options, derivatives, volatility products, leveraged tokens, and more.
It offers you a bunch of cool and useful features that any experienced trader would love. Also, the platform is designed in a way that beginners can register on the exchange and start trading.
You can also say that FTX is a cryptocurrency exchange where you won’t be trading any real assets. Instead, you will trade a derivative product that reflects the value of an underlying asset. This mainly represents a term of contacts or tokens that represents the price of an asset.
Among all the features FTX offers, leverage trading is surely the most popular one. As a trader, you must have 10% collateral on the exchange.
FTX only allows you to increase your position depending on the initial margin fraction. For small positions, the Margin Fraction must be at least 5%. As a result, you can initialize positions to a maximum of 20x leverage. Also, as your position size increases, your initial margin fraction also increases.
For example, if you have $1000 of collateral in your account, you can initialize maximum leverage of 20x, which is $20,000.
However, before you sign up on the exchange, make sure to check their leverage margin out. As they might change it by the time you are reading this. You can calculate your taxes with a crypto tax calculator.
How To Register on FTX?
Registering on FTX is a pretty straightforward process. However, if you do need a little help, here is a step by step guide:
- First, go to FTX.com if you live outside the USA. If you live in the
USA, go to the FTX.us website.
- Click on the Register button.
- Next, enter your email address and a preferred password and clicon
the Sign up button.
- Now you have to go through a verification process. So select between individual or institution.
- Next, enter your legal name, date of birth, country of residence,
phone number, and address.
- After that, you will be required to upload any of your government IDs to complete the KYC process.
- Once done, wait for 1 to 3 business days for FTX to review your
application and approve your account.
After that, you should be able to start trading on FTX.com. Simply deposit your funds, and you are good to go.
How to deposit your funds?
Before you deposit your funds, you need to make sure that your account has gone through the KYC level 2. If you don’t complete your KYC, you won’t be able to deposit funds.
Also, when it comes to depositing funds, FTX supports a wide range of fiat currencies. Such as USD, SGD, AUD, CAD, CHF, TRY, EUR, BRZ, and so on. Apart from fiat currencies, you can also deposit crypto tokens, leveraged tokens, and tokenized stocks.
To deposit your funds, you have to follow these below steps:
- First, go to FTX.com and sign in using your account.
- Click on Wallet from the top navigation bar.
- Next, select the currency type you wish to deposit. Such as crypto,
leveraged tokens, fiat, tokenized stocks.
- Now, look for the currency you wish to deposit, and next to it you will find a deposit button. So click on that.
- Next, you will find different options to deposit funds. For instance, if you are depositing USD, then you can deposit via card, via wire, or through cryptocurrencies. So select your preferred option.
- Depending on your selection, you will find an option to deposit your funds. So follow all the onscreen steps, and you should be good to go.
Note: Depending on what payment method you have selected, it will charge different deposit charges. So make sure to select a deposit option that is affordable for you.
Similarly, you have to click on the withdraw button next to a currency to withdraw your funds. You should also know that FTX only charges for withdrawals made in USD and BRL.
As a result, withdrawals under $10,000 may incur a charge of $75. Plus, BRL has a 0.3% + R$10 withdrawal fee.
How to make your first trade with FTX?
Once you have deposited funds into your FTX account, you are all set to trade. Now depending on what instrument you wish to trade, you will get to see different interfaces. However, the basic options are similar for every instrument available on FTX.
Anyway, for this guide, we will be trading in BTC/USDT in the spot market. And for this, you have to follow the below steps:
- First of all, log in to FTX.com if you aren’t already.
- Now from the navigation bar, select Markets, and it will list down all the trading pairs available. You can go through the list to find a pair or use the search button.
- After you click on the trading pair, it will open the chart, and below that, you will find the buy and sell options.
- To buy BTC, enter your price and the amount. Also, do select your limit order and click on the Buy button.
That’s it. You have successfully made your first trade on FTX. To sell your holdings, you have to switch to the sell tab, enter the price and amount of coins you wish to sell, and click on the sell button.
FTX Trading Fees
Just like most exchanges, FTX also follows a tiered fee structure for spot and futures trades. If your trading volume is less than 2,000,000 over the last 30 days, then you will be paying 0.020% as maker fee and 0.070% as the taker fee. However, if you do increase your trading volume, the maker and trading fee will reduce drastically.
Apart from this, there are two types of fees on leveraged tokens. This includes:
Creation & Redemption Fee: FTX charges 0.10% as creation and redemption fee. However, you would only pay this if you create/redeem. But the charge doesn’t apply if you buy in the spot market or convert.
Management Fee: FTX charges 0.03%/day on leveraged tokens. This value is simply subtracted from the net asset value of the leveraged token.
Final Words:
So that was a quick answer to your how to leverage trade crypto with FTX questions. I hope this guide has helped you to get started with the trading platform. In case if there is anything else you would wish to ask, do comment below.
