Crypto exchanges limiting margin

as reported by Forbes this AM, FTX is the latest exchange to limit margin. FTX is now limiting margins trades to 20X from it’s prior, 101X cap. About a two minute read.

Comment: another sign crypto is maturing, or are exchanges trying to front run the upcoming regulatory onslaught? The truth is likely in the middle, but let’s face it — buying on margin is like riding a roller coaster. Leveraging 101X isn’t a valid strategy, a little volatility and you’ve got a problem. And I’d argue even 20X isn’t appropriate. I don’t margin anything — stocks, commodities, property or crypto. Best just to live within your means and only buy what you can afford. Less stressful, you’re in full control and you no longer fear market / asset volatility.

FTX CEO’s Twitter thread below:

1) An effective margin system is integral to an efficient economic system.

There are limits to everything, though.

— SBF (@SBF_Alameda) July 25, 2021

Finance Facts on Margin