Leverage is a multiplier that increases your buying power beyond your deposited funds. When you trade with leverage, you control a position far larger than your actual account balance. BitMEX offers up to 250x leverage on select products, meaning you can control 250 Bitcoin worth of contracts with just 1 Bitcoin as collateral. Leverage is a multiplier that increases your buying power beyond your deposited funds.
Leverage applies to both perpetual swaps and traditional futures contracts on BitMEX. The maximum available leverage varies by product and is determined by the initial margin and maintenance margin requirements for each contract.
Why do traders use leverage?
Traders use leverage for capital efficiency. Rather than depositing the full notional value of a trade, leverage allows a fraction of that value to serve as collateral.
Key reasons traders choose leverage:
- Amplified returns. A 1% price move on a 100x leveraged position produces a 100% return on the margin deposited.
- Capital efficiency. Traders can maintain exposure across multiple positions without committing their entire balance to a single trade.
- Flexibility. BitMEX allows leverage from 1x up to 250x, giving traders control over their risk-reward ratio.
Leverage amplifies losses at the same rate as gains. A position using 100x leverage faces bankruptcy from a price move of roughly 1% against the position. Higher leverage demands stricter risk management, including stop-loss orders and careful position sizing.