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Japanese Gov’t to Limit Bitcoin Margin Trading Leverage to Just 2x

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Goodbye 100x: Japanese Gov’t to Limit Bitcoin Margin Trading Leverage to Just 2x

 

Margin trading has arguably been one of the most popular features of the crypto markets that has drawn in floods of traders over the past few years. These traders are lured by the ability to trade the already volatile assets like Bitcoin with leverage as high as 125x on some platforms.

 

Analysts have noted that the massive amounts of margin readily available to traders is one factor that has been driving the market’s volatility, as it allows users to magnify their positions without having to risk a significant amount of capital.

 

Naturally, margin trading is filled with significant risk, and the Japanese government is now taking actions to bar traders from using large amounts of leverage, which could be a growing trend that impacts Bitcoin and the nascent crypto markets.

Japanese FSA Looks to Limit Margin Trading Maximum Leverage to 2x

In a recent report from the Japan Times, the newspaper explains that the country’s Financial Services Agency (FSA) is currently moving to limit the maximum leverage available to users to a mere 2x, which is a far cry from the 25x, 50x, and even 125x that many traders are used to using.

 

Essentially, leverage allows users to significantly increase their trading capital without having to risk a sizeable amount of their personal funds.

 

For instance, if a user looking to trade with $100 worth of Bitcoin opens a 100x leveraged position, they will essentially be trading with $10,000 worth of Bitcoin. This can expose them to massive upside should the asset’s trend favor their position, but high amounts of leverage also come with liquidation prices incredibly close to the trader’s entry price, meaning that tiny price fluctuations can lead the trader to lose all the funds they used to open the position.

Will This New Rule Impact Bitcoin and the Crypto Markets?

It’s no secret that a large amount of the cryptocurrency markets trading volume stems from active investors who are tapping into margin, but it is important to note that most countries have already regulated these financial instruments, with investors finding simple ways to bypass these restrictions.

 

Bitcoin margin trading with significant leverage is actually banned in many countries, including the United States, due to the platforms not adhering to those specific country’s regulations.

 

Traders, however, bypass these bans by using Virtual Private Networks to create trading accounts with the appearance that they are in a country that allows crypto margin trading.

 

Furthermore, many of these platforms do not require users to undergo Know Your Customer (KYC) proceedings, which means that users don’t have to verify their nationality or country of residence.

 

That being said, it is unlikely that this new bout of regulations by Japan’s FSA will have any major impact on traders, as they can easily utilize VPNs to access platforms that offer up to 125x leverage.

source: https://www.newsbtc.com/2020/01/11/goodbye-100x-japanese-govt-to-limit-bitcoin-margin-trading-leverage-to-just-2x/

 

This would be a sad news for the cryptocurrency traders in Japan if this is to be implemented. The reduction from more than 100x to just a mere 2x is simply too much. But then again, VPN once again offers relief from the steady stream of oppressive government regulations. Let's just hope that this would not have much impact on Bitcoins as a whole.

Edited by kyoukage01

 

New to the Cryptotalk forum? Here's something that might help you get started:

https://cryptotalk.org/topic/24401-forum-tutorials-tips-and-tricks-for-newbies-compilation/

 

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Yes I think if trading leverage in Japan is actually 2x then it would be very sad for all crypto users.  And I think the leverage that was 100x was pretty good, so doing it 2x is not good. It can be expected that everyone will earn in the middle of a much shorter stage.  It is still unclear how long this decision will last.

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the good effect is maybe the Japanese government anticipates many newbies who could lose in crypotcurrency margin trading considering crypotcurrency is very volatile, and maybe it's a nightmare for pro trader

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The leverage that Japan's government-issued margin trading has reduced to 2x is actually very low in trading.  And I think that for Japanese crypto users, it would be a lot less revenue for trading.  In that case the leverage of this trading was actually low but I think 50x was required.

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On 1/12/2020 at 2:18 PM, palalu said:

the good effect is maybe the Japanese government anticipates many newbies who could lose in crypotcurrency margin trading considering crypotcurrency is very volatile, and maybe it's a nightmare for pro trader

If your opinion is true then this is good decision from the Japanese government, because they are thinking about the newbies in this field and in this way I think every one will enter this field without much fear, don't you think ?? 

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It is really a sad  news .Now crypto  traders will not make good profit.This will effect crypto market of japan.Many people will effect with it and leave market.Because it is not gonna work for them.Market is now equal for all investors all small  and big gonna make profit on equal scale.

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On 1/14/2020 at 5:50 PM, Migo said:

If your opinion is true then this is good decision from the Japanese government, because they are thinking about the newbies in this field and in this way I think every one will enter this field without much fear, don't you think ?? 

Yep, maybe this is one of the strategies so people dare to try margin trading and no longer have a bad stigma about margin trading

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Well, we can look at the news on the positive side: First this means that the Japanese government accept bitcoin and exchanges that operate in cryptocurrencies and this is good because many governments have not accept cryptocurrencies so far. Likewise, the other thing is, actually, in my view, margin trading contains a lot of risk, and this step will be useful to reduce the risk, especially for people who do not have much experience.

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This is a clever decision to save people's investments because leverage trading is the method with highest risk and will make traders to become extremely greedy by thinking about huge profits with very small investments. Probably, the Japanese government wants to make trading a safer business for people and encourage traders to invest more safely and lose less money.

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On 2/12/2020 at 9:25 AM, imran777 said:

Yes, Germany's government should not have done so if he has done so, he will not take any more people but I think this method should not be closed

wait, I thought we talked about the Japanese government. Why are you talking about the German government? Are you typo?

On 2/12/2020 at 9:25 AM, Umme Haani said:

Yes I also think it's bad and I think traders will be able to earn well and if they do it again it will be very

very what? Why don't you continue your sentence? By the way, which trader do you mean will make a good income? If a pro trader I agree, but if a newbie trader maybe I don't agree because they don't have enough knowledge to do margin trading.

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@palalu I already reported those two some time ago but no action was taken so far. Your turn to report them, maybe? 😄 .

 

... ... ...

 

So far, I'm seeing comments where the reduction to a mere x2 is actually a good thing, for the newbies in trading anyway. But what will happen if those newbies have matured and aren't satisfied with just x2 anymore? Maybe things will work out if the trading leverage is gradually increased over time as more and more people are getting the hang of it. Has Japan envisioned this? We'll see...

 

Edited by kyoukage01
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New to the Cryptotalk forum? Here's something that might help you get started:

https://cryptotalk.org/topic/24401-forum-tutorials-tips-and-tricks-for-newbies-compilation/

 

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On 2/19/2020 at 11:25 AM, kyoukage01 said:

@palalu I already reported those two some time ago but no action was taken so far. Your turn to report them, maybe? 😄 .

 

Do you also include proof of the screenshot? I used to report spam accounts with evidence, in a few days he only had 2 posts, whereas before he had 1000+ posts😆. actually I'm sorry, but he always makes the same post on a different topic every day🙄.

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Well, this is unpleasant news, but the Japanese government may have a point of view regarding its decision. We have to look at any decision from several sides in order to complete the image.

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This is very bad news, and this raises my amazement. The Japanese government may have positive motives and a different view of the topic. We will see what Japan thinks soon.

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This is what I don't understand, As long as I am a major, meaning I am 18 years old, what I do with my money, is my concern, why these governments try to act like they are guardian of my money. Its my freaking money, I can and should be able to do what I please. What is the logic of reducing 100x to 2x. If I loose its my money, if I win it my money, who are they to tell me what to do. 

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On 1/12/2020 at 1:43 PM, kyoukage01 said:

source: https://www.newsbtc.com/2020/01/11/goodbye-100x-japanese-govt-to-limit-bitcoin-margin-trading-leverage-to-just-2x/

 

This would be a sad news for the cryptocurrency traders in Japan if this is to be implemented. The reduction from more than 100x to just a mere 2x is simply too much. But then again, VPN once again offers relief from the steady stream of oppressive government regulations. Let's just hope that this would not have much impact on Bitcoins as a whole.

If the Japanese government will do their mightiest to stop their users to bypass their security features that allows traders to only profit x2 and more than of it is already prohibited then it will likely to affect the crypto market in Japanese country. 

 

But if others can find a way to bypass this kind of security then it will be good for the traders though it will turn out that they are doing that is against the law of their government which is not good if we are going to sum up. 

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This move is interesting as Japan for the last three years was always legislating in favor of cryptocurrencies. Still the derivatives exchanges are just gambling in my opinion, and the move to restrict leverage down to 2x might be correct one. I don't think this will have any implications on price either. 

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I don't know about margin trading, but I heard about this in Japan, I think the Japanese government is making the right decision and doing very well, it helps to reduce risk and people will more assured

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Japanese government reduce crypto trading leverage 2x% its really very low, but its really sad think happens with crypto traders,I don't think its a good step taken by Japanese government, minimum 50% is better option, because so many experts leave this trading field because of low income.


 

   

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Although Bitcoin's mother currency emerged from Japan, I expected to support this project and not stand against it


THINK POSITIVE

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I have already heard about this news, is real or no I dont know, but if the Japanese government take this decision maybe will be the good way to help new traders by restricting leverage down to 2x.

 

 


 

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yes I have read this news some months ago I think this is very good because high leverage is very risky it Should be stop but there are some benefits of leverage trading but new people lose money in this because they have no knowledge about the leverage trading 

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The leverage of margin trading has been reduced to 2x from 100x. And it is not a good news for the crypto users and traders. But the government have implemented the theme for their interest i guess. Because the traders won't like this procedure. They could at least keep 40- 50% of the leverage. But Japanese traders should take it in a positive vibes and get used of it. 

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I expect that this step from the Japanese government will reduce the benefit of the big investors from the margin, but at the same time it will distribute fair and more regular investments and therefore there will be no layers that are not aware of investing cryptocurrencies in Japan.


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These are bad news, but I think the Japanese government is following these steps in order to make trading safe and I think these steps are correct measures because they reduce the risks related to trading and reduce the losses of users

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A complete turnaround is not to be expected, but a softening of the position will still occur, Qureshi said.   CNN has recently reported on upcoming debates between Biden and his competitor, Donald Trump. The incumbent president will have to answer a number of uncomfortable questions about the harsh policy towards the crypto industry, which led to the outflow of cryptocurrency capital, the closure of large companies, and high-profile lawsuits. From Donald Trump, who turned the topic of cryptocurrency into a weapon against his opponent, in addition to attacks for the current state of affairs, loud pre-election promises can be expected, which could lead to significant volatility in the crypto market. Possible participation of Elon Musk, who expressed willingness to become a moderator, and independent candidate Robert Kennedy Jr., should enliven the debates, the first round of which is scheduled for 27 June, and the second for 10 September.   The main beneficiary of the past week was not bitcoin but ethereum. On Monday, 20 May, news reached the media that the US Securities and Exchange Commission (SEC) asked companies to update Form 19b-4 in applications for launching spot Ethereum ETFs in an accelerated manner. After these news, the financial agency Bloomberg immediately raised the chances of such funds being approved from 25% to 75%. Against this background, the leading altcoin quickly outpaced the flagship cryptocurrency in terms of growth rates.   The deadline for the first two applications from VanEck and Grayscale was Thursday, 23 May. Shortly before the X hour, ETH/USD reached $3,947, showing a growth of almost 30% in three days. According to Coinglass, the amount of liquidations and forced closures of short positions on crypto exchanges amounted to $340 million. A total of 78.8 thousand positions were liquidated, and the largest individual liquidation occurred on the HTX exchange for the ETH/USDT pair for $3.1 million.   The SEC did not disappoint expectations and on 23 May approved not two but a total of eight applications for the issuance of spot ETFs based on Ethereum and gave the go-ahead for trading and listing these funds on exchanges. According to Variant Investments Chief Legal Officer Jake Chervinsky, this step signals a "significant shift in US crypto policy, possibly more important than the ETFs themselves." This may also mean that recognizing ethereum as a commodity, the regulator will not categorize many other altcoins as securities. According to Rekt Capital, the market is already on the verge of an altcoin rally, the peak of which is expected in July.   Experts expect significant capital inflows after the listing of ETH-ETFs and believe that billions of dollars will be invested in derivatives in the first week after trading starts. Analysts from QCP Capital believe that the altcoin rate in the short term can rise to $4,000 and exceed $5,000 by the end of the year.   An even bolder forecast is given by Standard Chartered Bank economists. They expect capital inflows into such funds in the first year to range from $15 to $45 billion (2-9 million ETH). In this case, the fund's demand will lead to the asset's rate rising to $8,000 at a bitcoin rate of $150,000. Moreover, if market dynamics are positive, by 2025, the price of Ethereum will reach $14,000, and bitcoin's rate will increase to $200,000.   As of the evening of Friday, 24 May, BTC/USD is trading at $69,900, and ETH/USD at $3,735. The absence of an immediate pump and some drawdown of this pair on 23-24 May can be explained by the fact that everyone who wanted to has already managed to buy ethereums ahead of the SEC's historic decision. The total cryptocurrency market capitalization is $2.55 trillion ($2.42 trillion a week ago). The Bitcoin Fear & Greed Index (Crypto Fear & Greed Index) has not changed and remains in the Greed zone at 74 points.   And in conclusion of the review, forecasts from Artificial Intelligence. The latest version of GPT-4o from OpenAI believes that the price of bitcoin on 1 August 2024 will be in the range of $76,348 to $89,108 "considering current market factors and historical trends." GPT-4o's competitor, the anthropic AI model Claude 3 Opus, has formed an even more optimistic vision, designating the range between $105,072 and $167,808 by the indicated date. NordFX Analytical Group   Notice: These materials are not investment recommendations or guidelines for working in financial markets and are intended for informational purposes only. Trading in financial markets is risky and can result in a complete loss of deposited funds.   #eurusd #gbpusd #usdjpy #btcusd #ethusd #ltcusd #xrpusd #forex #forex_example #signals #cryptocurrencies #bitcoin #stock_market   https://nordfx.com/ 
    • Там то и тыкать не особо нужно, включил и пускай фармит. Это в других тапалках (и то не во всех) нужно каждый раз тыкать, тут почти пассив 😉
    • Полиция Южной Кореи раскрыла крупную группу криптомошенников   Южнокорейские полицейские арестовали 19 человек, которые выступали участниками мошеннической группы, действующей в социальных сетях. По данным властей, задержанные управляли открытым чатом, через который обманули сотни криптовалютных инвесторов.   Изначально мошенники предлагали пользователям чата законные способы вложений в цифровые активы, используя их некоторые инвесторы даже смогли получить прибыль. Такие действия преступников должны были усыпить бдительность, чтобы в дальнейшем люди без раздумий инвестировали в незарегистрированные криптовалюты. Когда инвесторы поняли, что их обманули, они потребовали вернуть деньги, но мошенники к тому времени уже заблокировали доступ к чату.   В результате расследования правоохранители выяснили, что в сети мошенников попали 308 человек, которые в общей сложности лишились примерно $19 млн.   По данным полицейского управления Южной Кореи, ещё как минимум шесть преступников находятся на свободе, скрываясь в других странах. Интерпол уже получил «красные уведомления», предписывающие арестовать их. Все участники мошеннического чата были завербованы главарём, чьё имя пока не раскрывается. Он помогал им незаконно въезжать в страну, а затем забирал у этих людей паспорта и мобильные телефоны, чтобы принудить к сотрудничеству. Источник - https://ru.investing.com/news/cryptocurrency-news/article-2425428
    • Даа, лучше поздно, чем никогда. Все таки будем вернуть свои ошибки, когда альты тоже будут расти. Но биткоин пока уверенно себя ведёт, я уверен что до конца года дойдет хотя бы до 90к. Эти альты меня так пугали, что с очень осторожностью покупаю их. 
    • Добрый вечер, уважаемые пользователи! Мы работаем ежедневно с 10:00 до 22:00 (МСК)  - Дорогие друзья, напоминаем Вам про #Акцию, дарим бесплатные AML проверки, для этого нужно обратиться в Telegram с сообщением "бесплатная AML проверка". Желаем Всем тем, кто работает - прибыльного и продуктивного дня. А тем, кто не работает - хороших выходных.
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