While traditional spot trading only allows profiting after the price rises, 100x leveraged futures trading does so regardless of the market going up or down. More than 3,000 traders on the stock exchange achieved returns on investment amid the crash, with 1366% being the highest.
According to Bloomberg, 60% of 950 investors surveyed believe Bitcoin (BTC) will suffer another drop of around 45% to reach USD 10,000. However, the remaining 40% think its price may return above the relevant psychological support at USD 30,000.
Over the last few months, the price of BTC has mirrored traditional stocks amid growing macroeconomic uncertainty. The US Federal Reserve (Fed) pledged to raise interest rates and take quantitative tightening measures to control skyrocketing inflation. For that reason, there have been many notable sell-offs in crypto and global markets.
The price of Bitcoin has lost more than 70% since the all-time high of USD 69,044 reached in November 2021. Jared Madfes, a partner at Tribe Capital, said it is easy to be scared because of the situation of cryptocurrencies worldwide. In addition, he commented that expecting another significant Bitcoin pullback reflects the people in the market are afraid.
If the results of surveys were reliable, Bitcoin could now be about to suffer another crash. Scott Minerd, the director of Guggenheim Partners Global Investment, previously predicted that Bitcoin would reach USD 8,000 before finding a market bottom.
However, some market holders took advantage of this drop to make profits by more than 2000%. It is necessary to understand the investment method 100x leverage cryptocurrency trading.
How 100x Cryptocurrency Trading Leverage Works
Traditional spot trading only allows buying and waiting for the price to rise to make a profit. With 100x leveraged futures trading, investors can buy (go long) or sell (go short), making profits regardless of the market going up or down.
With 100x leverage, traders can invest 1 BTC to open a position worth 100 BTC. They would go either long (predicting the price to rise) or short (predicting it to fall).
They can also use 1 BTC to open a perpetual short contract at USD 22,000 and close it when Bitcoin trades at USD 17,000. In that case, their profit will be (USD 22,000-USD 17,000) * 100 BTC/USD 17,000 ≈ 29.41 BTC, making a 2275% return on investment (ROI).
According to data from Bitwells, more than 3,000 traders on the stock exchange made profits amid the crash. While the highest return on investment was 1366%, the average ROI among the top 100 traders was 489%.
Some analysts and experienced traders see the collapse of the crypto market as an opportunity. While some prefer to hoard coins, others choose to invest in leveraged positions.
Bitcoin is trading at around USD 20,630 and has accumulated a 1.3% loss over the last week. While its trading volume is above USD 41.51 billion, its market capitalization is about USD 393.90 billion, according to CoinGecko.
By Alexander Salazar
