⚡Leverage
What leverage is
Leverage lets you trade with more capital than you actually hold; basically, you’re borrowing funds to amplify your position. On Moonshot, leverage can boost your buying power and potential profits, but it also magnifies your exposure. The higher your leverage, the faster both gains and losses can stack up. Managing leverage isn’t just about chasing upside; it’s about knowing your limits, setting smart stop-losses, and understanding that bigger swings cut both ways.
Leverage trading 101
Think of leverage trading like taking a position on the price movement of a token without having to actually buy it.|
Let's break it down: Imagine you want to gain exposure to possible Bitcoin price appreciation, but you don't want to buy actual Bitcoin. With leverage trading, you can establish that position!
The key things that make leverage trading special:
No end date: Unlike regular futures contracts that expire on a specific date, leverage trades can be held as long as you want.
Directional trading: You can take a long position (going "long") if you believe the price will go up, or you can take a short position (going “short”) if you believe the price will go down.
Using leverage: You can control a large amount with just a small deposit. For example, with 10x leverage, $100 could let you control $1,000 worth of Bitcoin exposure.
Here's an example: If Bitcoin is currently worth $50,000. You think it may go up in price.
You put $500 into a contract with 10x leverage
This gives you exposure to $5,000 worth of Bitcoin price movements
If Bitcoin goes up 10% to $55,000, your position would be worth $5,500
Your profit would be $500 (a 100% return on your $500)
But if Bitcoin drops 10%, you'd lose your entire $500
The prices of leveraged trades track the actual asset price through a clever system called "funding rates," in which traders on one side sometimes pay small fees to those on the other.
The biggest advantage is that you can keep this position open as long as you want - there's no deadline to close it, as long as you have enough money in your account to maintain the position.
Market orders made simple
What is a Market Order?
A market order is a straightforward way to buy or sell digital assets at the current best available price. When you place a market order, it executes immediately using whatever prices are currently available in the marketplace. If your entire order can't be filled at once, any unfilled portion is automatically canceled.
How to Place a Market Order:
Select whether you want to "Buy" or "Sell"
Enter the amount you wish to trade, or adjust the leverage slider to your preferred level
Closing a Position
Your positions are located in the Holdings tab in your Moonshot app under “Leverage.” Select a position to place a market order and close the position.
Leverage limits
Moonshot offers leverage of up to 250x on SOL, ETH, and BTC. You can adjust your leverage based on your position size and personal risk tolerance. Higher leverage increases your potential returns, but it also raises your exposure, meaning even small price moves can lead to liquidation if the market turns against you. Always choose a leverage level that aligns with your strategy and risk comfort.
Risks with leverage
Leverage doesn’t just turn up the volume on your trades; it turns up the stakes. When you borrow to amplify a position, even small market moves work against a smaller cushion of your own capital. That means your cash can be wiped out quickly if the price moves the wrong way. Positions can be liquidated if your collateral can’t cover the losses, and in high-leverage setups, that can happen faster than you expect. Using leverage responsibly isn’t about avoiding risk altogether; it’s about understanding that total loss is a real possibility. Know your liquidation levels, size your positions thoughtfully, and only use leverage on capital you’re prepared to lose.
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