Two of the leading cryptocurrency derivative trading platforms – Binance Futures and FTX – are reducing the maximum allowed leverage on their platforms.
Ran by Sam Bankman-Fried, FTX is one of the leading cryptocurrency derivatives trading platform, offering high leverage of up to 100x to its customers.
This, however, will no longer be the case as the exchange plans on trimming it down to 20x, citing consumer protection concerns.
Speaking on the matter, SBF actually revealed that the average leverage that users are currently taking advantage of is 2x. Hence, the move will only “hit a tiny fraction of activity on the platform.”
Quickly after that, Changpeng Zhao, CEO at Binance – the worlds leading cryptocurrency exchange, announced similar doings for their derivatives arm – Binance Futures.
Binance Futures started limited new users to max 20x leverage last Monday, July 19th – 7 days ago. (We didnt want to make this a thingy).
In the interest of Consumer Protection, we will apply this to existing users progressively over the next few weeks.
Both moves come at a time when global financial regulators are taking measurable actions to interfere in the industry and somewhat put it under existing regulatory standards in traditional finance.
