Japan-Based Liquid Now Offers Leveraged Bitcoin CFDs

Liquid.com, operated by Japan-based cryptocurrency exchange Quoine launched Bitcoin (BTC) CFDs, a new margin product to cater the customers with a taste for high-leverage trading, according to the press release published on April 2.

On the Menu

The new financial instrument dubbed Liquid Infinity is designed for professional traders who want to increase their cryptocurrency exposure with minimum capital input. According to the Chief Product Officer of Liquid, Mario Gomez Lozada, the company developed and launched the Bitcoin CFDs responding to rising demand for leveraged cryptocurrency products among professional traders. Other core margin products offered by Liquid only go up to 25x leverage, while Liquid Infinity, on the other hand, will allow traders to bet on Bitcoin price movements against the USD and JPY with leverage up to 100x. The size of the leverage will be constrained based on the size of the position. Also, Liquid Infinity traders will be able to take cross-margin positions to balance maintenance requirements and use an extensive suite of risk-management instruments available for Liquid margin products.

Not For Everyone

Contracts for difference are speculative instruments that allow traders to take long or short positions on an asset without actually owning it. Basically, buyers and sellers of the contract bet on the price movements for the underlying asset and agree to pay the difference between the current value of an asset and its value at contract expiration. This type of instrument is highly popular among online brokers and companies that offer financial trading services to retail and professional traders. Many large Forex brokers added CFDs for various digital assets a long time ago to tap the lucrative market and attract new traders. However, in some jurisdictions, these instruments are not welcomed. Thus, the European Securities and Markets Authority (ESMA) considers them as gambling in disguise. The regulator imposed a strict ban on CFDs for non-professional traders. Meanwhile, Liquid says Infinity will be available for all eligible customers except for residents of Japan. Cryptocurrency markets can be extremely volatile, which makes leveraged products quite risky. Do you think it’s prudent to trade Bitcoin CFDs on 100x leverage? Let us know your thoughts in the comments below.