Why Is Leveraging Better in the Crypto Niche? A MargiX’s Perspective
Before getting into the specifics, let us understand the term ‘leveraging’ first. Well, it is a technique that allows traders to borrow money, increase their buying power and then make a significantly huge investment.
MargiX offers a robust and futuristic solution in this regard by facilitating leveraging on its margin trading platform.
Exploring the Pros Offered by MargiX
Now that we have established a decent and essential understanding of the core term, it’s time to dive deeper and understand the pros of utilizing this trading technique.
➢ It’s Highly Lucrative
The overall market is quite volatile and while some people are afraid of it, leveraging takes advantage of this phenomenon. It does not only allow you to yield higher profits in a much shorter span, but the amount you invest from your pocket is also significantly less.
For example, if you have $50 to invest from your wallet and a lender gives you $150, your buying power increases by 4X and it implies that you can purchase four times more tokens and increase the value of your portfolio. Therefore, while sparing only 1/4th of the total amount, you position yourself to receive a quadrupled return.
See, the market is already volatile and if you do not have enough cash, then waiting for it might not be favorable in most of the cases. Therefore, borrowing money from someone and investing it immediately in a couple of tokens might allow you to benefit from timely market opportunities.
➢ Diversification of Portfolio
Since your buying power increases by taking money from the lenders, it allows you to buy a variety of tokens. For instance, with just $50 in your wallet, you could have thought about buying a fractional amount of one token only. However, with $250 in hand, you can buy a significant amount of tokens. While some people may argue that the RoI on one token gets decreased by this approach, the overall risk is reduced and even if a coin experiences downfall, other investments can balance it off and keep you afloat.
➢ Extremely Fast
Most of the margin trading ventures are centralized as they hold the leveraging decision in their hands — there is no concept of an individual. This approach is outdated and diminishes efficiency as well.
On the contrary, MargiX is offering you a P2P system where every incoming user can act either as a lender or a borrower. (The procedure as to how this entire feasibility works is mentioned in the last section of this article)
It is worth mentioning that since we make use of intelligent and efficient algorithms, the processes are executed at a much faster pace than what our competitors are offering at the moment.
➢ Competition
Since we are introducing a P2P system, the competition is expected to surge in the next few months. This is because lenders would certainly want to partner with borrowers and hence, offer competitive rates to lure in the prospects.
This creates a win-win situation for both parties, but primarily for buyers who will enjoy lower price and higher leveraging power.
➢ Offers Multiple Options
In some trading and investment options, users are forced to pursue either long term or short term plans. However, margin trading is a bit different as it can be used for both purposes, depending upon the market situation at the time of making an investment.
Just to set the perspective for newbies here — when a trader plans to invest on a long term basis, he is believing that the price of the token(s) might go up in the near future. Contrary to this, in a short term plan, the investor buys crypto tokens when the price nosedives and sells it as soon as a reasonable profit is expected.
What is the Feasibility at MargiX?
Well, our feasibility comes in two parts. In the first one, we have a P2P system, allowing you to borrow money from the peers in the network. The lenders are supposed to create their offers as to how much they are willing to stake. Then the borrowers put in their requests, we present them with a list of potential lenders that they could choose from, hence ensuring that the entire margin trading process is decentralized.
In the second part, we make use of blockchain, big data and AI to penetrate deep within the crypto market, fetch data from a variety of exchanges and then feed the data sets to our AI-based algorithms. It allows our system to learn the outcomes of specific actions at certain instances and then predict the direction of tokens. This enables our margin trades to have better abstract-level insights in the market and make their decisions accordingly to yield maximum benefits.
Furthermore, we ensure that our exchange is beneficial and usable by newbies and experts. There is a variety of markers and other crucial indicators that assist you to navigate through the platform.
Support requests please send to: support@margix.org
Best regards.
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