Learn Crypto is dedicated to explaining basic concepts within cryptocurrency to people who are new to the subject. Given the level of potential risk leverage trading is something that really should be left to very experienced traders.
You might think that reading this article is a waste of time; that is far from the truth.
You may not be a skilled enough skier to ever attempt a black run but it is still important to understand the challenge and danger. It helps create a mind-map for the spectrum of risk involved in skiing and where you sit.
The same is true of cryptocurrency. The more you understand, the more you can make sense of news, sentiment and adoption.
March 12th, 2020 is known as Black Thursday, Bitcoin fell 50% within 24hours as the potential economic impact of the Covid19 pandemic instantly spread from the major stock markets.
This kind of dramatic event triggered a wave of liquidate leverage positions within crypto, and Margin Calls in other markets, with traders closing crypto positions to fund. This created a cascade effect. With Bitcoin dropping from a high of $7,648 to a low of $3,870.
“The traditional safe havens are struggling right now,
possibly because the institutions are liquidating
positions in these assets to fund margin calls in
the equity markets. “Where previously reporting of that kind of event from sites like Coindesk might have made no sense to you, by learning about subjects like leverage, you have the ability to absorb and understand what is happening from an entirely different perspective.
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