New York-based bitcoin exchange Coinsetter has enabled margin and short trading for all trader types, allowing them to leverage deposits by 5x, and without interest charged on the first $25,000 borrowed.
Coinsetter introduced margin and shorting earlier this year, but only for select accounts and market makers. The offering was rolled out concurrently with post-trade settlement, allowing qualified accounts to fund their accounts after making trades.
The value of both bitcoin and dollar deposits is taken into account when determining the maximum trading power.
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The move represents a push to attract traders in the competitive USD market. Coinsetter currently ranks ninth in USD-based trading volume during the past 30 days.
Coinsetter’s 5x leverage allowance is higher than the typical 3x provided by those offering margin. In an effort to woo traders, exchanges have been considering increasing their margin allowances.
Up until recently, bitcoin prices had maintained one of their longest stretches in history, raising the appetite for higher leverage among traders and making it less risky for brokers to offer it. Kraken CEO Jesse Powell told Finance Magnates that his exchange is considering raising its leverage to 10-20x. Forex brokers who provide trading on fiat currencies, which are ordinarily less volatile than bitcoin, can offer leverage as high as 1:1000.
Last month, Coinsetter partnered with ShiftForex to launch Bitbroker, allowing forex brokers to provide access to bitcoin trading based on Coinsetter’s marketplace.