The management at Binance, the world’s largest cryptoasset exchange in terms of trading volume, recently published a blog post in which they explained how margin trading works and how traders can potentially benefit from it.
As noted on Binance’s official website, margin trading involves executing trades by using the funds “provided by a third party.” The main advantage of margin trading is that traders are able to access more capital (while trading). This allows them to “leverage their positions”, Binance’s blog mentioned.
Margin Trading Increasingly Being Used In Crypto Markets
In other words, margin trading lets traders “amplify trading results” by being able to “realize” greater returns on “successful trades”, Binance’s management wrote. According to the Malta- based digital asset exchange, margin trading is a widely-used trading method in low-volatility markets - including international Forex, stock, and commodity markets.